America appears to be sleepwalking towards disaster

http://www.telegraph.co.uk/finance/comm ... -care.html


There is now, according to S&P, "at least a one in three chance" that American debt will be downgraded from its top-notch status over the next two years – which would be a first in modern times.

A New York Times/CBS News opinion poll has also suggested the US public is now more economically pessimistic than at any time since President Barack Obama's first two months in office in early 2009 – when the country was still caught in the "Great Recession".

Amid renewed talk of a "jobless recovery", the number of Americans who think the economy has deteriorated spiked by 13 percentage points over the past month. Congress, meanwhile, is locked in a bitter dispute over the federal government's ability to make ends meet.

The government won't take the steps needed to bring those jobs home-it would enrage their liege lords.
The voters won't cut back on their goodies
No one will pay higher taxes.
Can't pull out of any wars- don't want to look like losers.

We're not sleepwalking, we're galloping.

Actually usually 33% of America can't even be bothered to pay attention to what is going on, but raise their gas prices and people get pessimistic.
If Obama was smart, he would do whatever he could to lower prices and get America back to sleepwalking, but Barack doesn't want to piss off his big donors by pushing domestic drilling.
I saw a stupid letter to the editor the other day that said oil drilling in Alaska wouldn't decrease prices here because most of that oil is sold to Japan. Doesn't the letter writer understand a global market? If Japan can buy Alaskan oil, they will be buying less oil from Saudi Arabia and Venezuela, lowering the prices for American citizens.

Isn't S&P the same "genuises" who kept promoting as AAA gold-plated risks the same banks and investment banks that crashed the economy with theri toxic bundled securities?

Not sure I'd give anything they had to say much credibility. I'm guessing they either have no clue what they are talking about, or maybe even are pushing this line deliberately even though they know it's crap.

lol Maybe the S&P learned from their past mistakes and actually are examing balance sheets.

They also downgraded Chinese debt at the same time. The spector of inflation and their own property bubble have them worried.

SS109 wrote: lol Maybe the S&P learned from their past mistakes and actually are examing balance sheets.

rofllol

I'm suspicious of S&P. They have deliberately manipulated ratings before for their own reasons. Someone needs to examine their practices. Especially since they as far as I know are the only ones making this "prediction". On the face of it, I'd say it is ridiculous at least so long as the American dollar remains the reserve currency. You can't default on your own bonds so long as you have that advantage. Something smells rotten here.

While the US has no past record of defaulting on their bonds, many other countries have done it, some nations are multiple offenders.

Think the Chinese will be screwed if the US chooses to not honor thier debt? Nope, 60% of federal bonds are owned by Americans.

:thumbsup: Only default on the bonds owed to the Chicoms? Trump would love that idea since he likes to declare bankruptcy often.

I do not think the concern is default. It is inflating them to the moon. Check out a chart of the dollar vs oil.

For those who believe the S&P is devaluing US debt for political reasons, consider this, with 40% of the current budget funded by debt and new tax hikes being rejected by Republicans/TEA Party and any significant cuts to entitlements or discretionary spending rejected by the Left, it does looks like the US will continue on the same course.

Some pundits think we won't have significant talks on budget reform before the 2012 election because no one wants to go on record as slashing programs or raising taxes. SSDD.

So expect the GOP to verbally protest but quietly pass a raising of the debt ceiling.