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United States loses AAA credit rating from S&P

reuters.com

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Re: United States loses AAA credit rating from S&P

#481

Post by jebblue »

wtallis wrote: post #469
jebblue wrote: post #460

Earlier quoted context omitted.

Fox News and Christian bashing, it reads like Slashdot on here.

So complaining about extremist theocrats is crass if they call themselves Christian, but civilized if they're Muslim? It doesn't matter what religion it is, it's still a destabilizing influence on what's supposed to be a democracy. And Fox News had such a clear role in making the Tea Party into a meaningful political force that commenting on the connection isn't necessarily even a political statement - it's a histori…

Democracy? The US? http://en.wikipedia.org/wiki/United_States_of_America

Re: United States loses AAA credit rating from S&P

#482

Post by Bertil »

shiftpgdn wrote: post #391
Bertil wrote: post #349

Earlier quoted context omitted.

You seem to have forgot one point: the trillions spent in the Middle-East are to protect the supply of cheap Oil — so step 0. is: Sell your car, insulate your house.

We get more oil from the gulf and Canada than we do from the Middle-east. That's not to say energy savings are a lost cause.

You still pay it at international prices, that are set by events in the Golf.

Re: United States loses AAA credit rating from S&P

#483

Post by dvogel »

muzz wrote: post #431
dvogel wrote: post #267

Earlier quoted context omitted.

Thus far the risk of investing the SS surpluses into any investments other than US treasuries far out-weighed the risk of the US choosing to make SS forgive the debt incurred by said treasuries. I've often argued that SSA should be allowed to invest some portion of the surplus (perhaps 10-20%) in AAA-rated municipal bonds. Perhaps the downgrade today will prompt more people to consider this.

Isn't reducing the conflict of interest a small price to pay for slightly higher risk? Currently, Congress can "save" money by cutting benefits to Social Security receipients and use that money to pay off the bonds owed to Social Security.

Congress can't actually divert revenue from SS. The way that cutting benefits affects the budget is that the SSA uses more of the payroll tax to buy more bonds, rather than paying the revenue out as benefits. The government still has to use non-SS revenue to pay off prior SSA-held bonds. Thus, once SSA collects less from the payroll tax than they need to pay out (which will happen soon, and may have already happened due to the Making Work Pay tax cut), cutting benefits will not reduce the budget deficit at all, because the SSA will need all of the revenue from the payroll tax and all of the revenue from its maturing bonds to pay out benefits. In order to use any payroll tax revenue (via SS bonds) for non-SS programs, they would have to make unrealistically large cuts in benefits. So, in short, that well will run dry soon enough, and you won't have to worry about it.

Re: United States loses AAA credit rating from S&P

#484

Post by shirederby »

ericd wrote: post #244
dglassan wrote: post #213

Earlier quoted context omitted.

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 a…

A hospital's margins are only 1-2%? Do you have a source for that? Maybe they can pull that off by paying themselves all the profits, but there's no way that I buy that hospitals have thinner margins than grocery stores before that. Hospital administrators are very well off on average. Their fees are way too large to be running so close to the wire, given their expenses.

I was curious about this, so I searched around a bit.

This is the most recent I found -- a median of 3.1 percent: http://www.reuters.com/article/2009/08/19/us-hospitals-usa-i...

Re: United States loses AAA credit rating from S&P

#485

Post by IbJacked »

rayiner wrote: post #445
IbJacked wrote: post #270

Earlier quoted context omitted.

>> Trillions in debt is perfectly fine for an economy as large as America's. No it's not. Wouldn't it be much better to not have to constantly pay billions to simply pay the debt's interest? We aren't even reducing the principal, which is why we have to keep raising the debt ceiling. That's like saying it's perfectly fine to maintain a large credit card debt because you have a high income. Just because you can handle…

The US pays a very low interest rate on its debt. If you made $250k per year had a 3% interest rate mortgage of $200k, would you pay it off any faster than you had to? Of course not. You'd spend the money on things that would give you a much better return. There is absolutely no need for the US to pay down inflation. GDP growth will naturally reduce the effective value of the principal. The problem is the run-away in…

I agree with you for the most part, particularly about the run-away increase of debt.

I even agree that I would not payoff 3% debt while I could earn higher elsewhere. However, the government isn't doing that. They aren't delaying payback so they can earn a higher rate somewhere else, they are delaying payback and spending the funds.

Re: United States loses AAA credit rating from S&P

#486

Post by salemh »

stcredzero wrote: post #412
forgottenpaswrd wrote: post #355

Earlier quoted context omitted.

"The US is rich for the same reason Rome, England, and Spain were" Not really, have you been in England, Rome or Spain? Rome legionaries were used to make roads and bridges and mining 90%of their time. If I show you the extensions of the land they "washed" to get mineral you won't believe it(you can see it using google earth, e.g in the north of spain, look for grooves around mountains). England made itself rich beca…

Thomas Jefferson and other of the US founding fathers thought a permanent military and central banking would ruin the country because military people do nothing while things work at it should they need to create new enemies so they can justify their existence. The rise of a professional military is often cited in as a major factor in the decline of the Roman Empire. Military Conquest drove economic gain, which provid…

Fantastic podcast by history-phile Dan Carlin (also a political journalist, who does a fine job bashing both parties in reference to historical context, "Common Sense, with Dan Carlin" podcast)

http://www.dancarlin.com/disp.php/hh Death Throes of the Republic: The Fall of Rome

You will find so much fantastic similarities to our own downward spiral, re: military, political class of protecting special interests, where near the decline, voting blocks were outright purchased, etc. He brings together several historians, records, etc.

The entire series is wonderful, and you WILL find yourself spending way too much time on them :)

Re: United States loses AAA credit rating from S&P

#487

Post by salemh »

rwmj wrote: post #357
pyre wrote: post #326

Earlier quoted context omitted.

Not enough people would though. They would flock to the other candidate that would inevitably reassure them that everything was going to be ok. Heaven forbid that people should vote by thinking about the issues rather than just digestion a handful of sound-bites.

Well why don't you educate other voters on this issue? Knock on doors and canvass, even just print up flyers and push them through letterboxes.

Need an iPhone app linked to local government data with where, when, HOW to vote, appropriate links to the various candidates, etc. Start at a local level, burgeon up. KickStarter or O'Relly Gov20 project. Would love to see this tackled.

Re: United States loses AAA credit rating from S&P

#489

Post by puredemo »

marcamillion wrote: post #298
pitdesi wrote: post #65

An answer to the question we're all wondering- "What happens now" answered well in a planet money from a couple of weeks ago: http://www.npr.org/2011/07/18/138164761/what-happens-if-u-s-... TL;DR - "I'm not sure it will have any impact. When you look at the bond market — 10-year U.S. Treasuries, for example — where is it today? In the light of all this hype about debt ceilings and possible defaults, it's at 2.93 toda…

The reason yields have been so low is because a) there is no other 'safe haven' for investors to flock to, and b) the markets generally didn't anticipate a downgrade. A downgrade, even if the markets don't raise Yields, can be catastrophic because many financial institutions (mutual funds, insurance companies, unit trusts, etc.) can only hold AAA rated securities in their portfolios - and some central banks can only…

How does this play out with the multiple ratings firms though?

Re: United States loses AAA credit rating from S&P

#490

Post by orijing »

notatoad wrote: post #434
CamperBob wrote: post #247

Earlier quoted context omitted.

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. Once you realize that the military is not a collection of armed forces so much as it is the US's largest social welfare program, these policies and figures start to make more sense.…

i see this point made every time the discussion about military spending comes up, and i hate it so so much. what this argument boils down to, for me, is "we need to keep killing foreigners so that our economy doesn't suffer", and this is a morally reprehensible position.

It sounds less defensible to pay young able-bodied men to kill foreigners than to pay the same to study or plant trees here.

Plus, how much of the money that we funnel to Iraq actually goes back to the US economy, compared to if we spent it in the US directly?

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