(via angriers@reddit)
http://en.wikipedia.org/wiki/List_of_countries_by_credit_rat...
United States loses AAA credit rating from S&P
211–220 of 518 posts
Re: United States loses AAA credit rating from S&P
#212Re: United States loses AAA credit rating from S&P
#213(Reference: http://www.federalbudget.com/ ) Steps to recovery: 1) End all offensive military actions overseas. Finish winding down Iraq and abandon Afghanistan wholesale. These actions have cost several trillion dollars over the last 10 years. We can't get that money back, but we can stop spending more. 2) Defense spending is in the top 3 highest budget expenditures. Cut it by 1 third across the board. Maintain impor…
Tearing the healthcare system down to it's nuts and bolts would costs a lot more than to continue reforming. I spent some time consulting hospitals an implementing electronic medical record systems for hospitals. It costs a hospital millions of dollars and thousands of hours to install and train people for these systems. Too many hospitals are too deep in these EMR systems to start from scratch again. Their margins are only around 1-2 percent as it is.
I agree, the healthcare system is a complete mess, but think of it like re-writing software. Sometimes continuously refactoring code is a much wiser decision than completely re-writing the code
Re: United States loses AAA credit rating from S&P
#214Earlier quoted context omitted.
> Again this is based on the same logic that people will treat the U.S. Government the same way they'd treat any other person and that's just not going to happen. It's not a matter of how "people" treat it. Many funds are prohibited from holding anything other than AAA. Those folks will now be selling bonds. For those that haven't looked at the math of bonds: When the price of a bond goes down (as it does when there…
It's a little more complicated than that. Treasury bonds are actively traded on secondary markets. The 'price goes down, yield goes up' generally refers to secondary markets. The concern for the U.S. govt isn't the secondary market. It is the primary market where they auction off bonds to raise money to fund operations. In the primary market, the U.S. treasury issues a certain number of bonds in order to raise a spec…
US government doesnt sell bonds to fund operations, it is never revenue constrained (because the US dollar is a non-commodity backed, floating exchange rate, fiat currency). It sells bonds to remove dollars from the system.
Re: United States loses AAA credit rating from S&P
#215Mindboggling. Does the S&P understand that the U.S. debt is all denominated in a currency that the U.S. government can print at will? If the U.S. government doesn't have an AAA rating, what does an AAA rating even mean? At the moment, the national "debt" is over $10 trillion dollars, while the total supply of currency is about $2 trillion, and total government profits are about negative $1.5 trillion. If we assume th…
[deleted]
Re: United States loses AAA credit rating from S&P
#216Earlier quoted context omitted.
What constitutes defense spending nowadays? Is it largely salary payments to current troops? Wouldn't we have to deal with a large unemployment problem in case we laid off a bunch of military employees and told them to go find a job somewhere else? Or is it payment to defense contractors, such as Valley's own Lockheed Martin? Wouldn't this cause a large number of people to be unemployed, contributing to recession?
Is it the government's job to keep people employed for the sake of employing them? No! There are times in history where government spending can help , like during the Great Depression. The government spent a lot of money on public works projects to help put some people back to work. But this didn't do much to actually end the depression. It was the onset of WWII and the subsequent ramp-up to a war economy that really…
Right, I'm not arguing the philosophical aspect of employing people for the sake of employing people.
However, laid off militants are likely to apply for unemployment benefits + whatever other entitlement programs they have. So in terms of pure numbers there might be some win, but when you cut $100 of military salary, you don't magically save a total of $100, you generate some liabilities on the other end.
All those military salaries also generate income taxes for Federal and state coffers, so now you've got lower revenues to deal with, too.
Re: United States loses AAA credit rating from S&P
#217Mindboggling. Does the S&P understand that the U.S. debt is all denominated in a currency that the U.S. government can print at will? If the U.S. government doesn't have an AAA rating, what does an AAA rating even mean? At the moment, the national "debt" is over $10 trillion dollars, while the total supply of currency is about $2 trillion, and total government profits are about negative $1.5 trillion. If we assume th…
You are correct in everything you've said. The national "debt" clock should be thought of more as a national "savings" clock...
Re: United States loses AAA credit rating from S&P
#218Earlier quoted context omitted.
Even if you tax the hell out of the rich, it still leaves this country TRILLIONS in debt. It's a fact - you don't tax your way out of a recession and you sure as hell don't tax people to create jobs. It simply doesn't work. And yeah, great idea. Let's cut military funding while we're fighting a war on terror in three countries. Apparently you don't remember Clinton's military cuts which removed almost 300,000 people…
you sure as hell don't tax people to create jobs vs military cuts ... sending a lot of people to the unemployment line. so, you don't tax people to sustain jobs, yet you don't cut jobs to lower spending. That is paradoxical.
First of all I fail to see how taxing people sustains jobs. As a business, if you're having to give more money to the government, and putting less of it back into your business, it would seem you're actually creating an incentive to lay people off as opposed to hiring more. It makes it harder to grow and hire more people if your business is taking in less money. I know it's obvious but. . .
There are a million ways to cut spending. Taking Obama's 2.5 TRILLION dollar "Obama Care" would be a great start. Take out his TRILLION dollar stimulus which was an epic failure and guess what? You just saved 3.5 TRILLION dollars without cutting any jobs.
Re: United States loses AAA credit rating from S&P
#219Mindboggling. Does the S&P understand that the U.S. debt is all denominated in a currency that the U.S. government can print at will? If the U.S. government doesn't have an AAA rating, what does an AAA rating even mean? At the moment, the national "debt" is over $10 trillion dollars, while the total supply of currency is about $2 trillion, and total government profits are about negative $1.5 trillion. If we assume th…
Paying back creditors in severely devalued dollars isn't exactly meeting obligations. Presumably the ratings would take this into account.
That said, I agree these ratings don't have much basis in reality. As others have commented, look at how S&P and similar organizations rated subprime debt. They're part of the Wall Street club. They might nibble a bit on the hand that feeds them for political reasons, but they certainly aren't going to bite it off.
It's pretty clear that a AA+ rating for US debt is as much of a joke as AAA. The token 'downgrade' gesture just adds to the absurdity.
Re: United States loses AAA credit rating from S&P
#220One minor elephant in the room that only a few seem to be mentioning is the 500+ point selloff on Thursday. On Thursday evening, the economist talking-heads expressed some confusion about what was driving that sell-off on that particular day. There was vague talk of problems in Europe, although there has been worse news out of the Eurozone for months without that kind of drop. On Friday, we get the S & P announcement…
The potential implosion of EU, caused by Italy or The rich is alerted the downgrade first, naturally.
Yep. I'm more than a bit suspicious that it's your option 2, given that it's been "Greece"..."Italy"..."Ireland"..."Greece"...Euro-disaster talk for months now without the kind of precipitous one-day decline that just happened to precede this announcement.