Interesting perspective on the stock market dive....

PrintSmith wrote:

AspenValley wrote: From a CEO, not a pundit...

http://www.huffingtonpost.com/michael-k ... 21313.html

The stock market fell because last Tuesday night Congress approved, and President Obama signed, an agreement to cut public expenditures by $2.5 trillion over the next decade. That is the only significant change in the real world.

Those expenditures, which would have been financed entirely by borrowing money, would have put money in the pockets of defense contractors, road builders, home health care providers, school districts, and thousands of other companies, nonprofits, and individuals.

Those expenditures would have boosted the economy, expanded GNP, and, most importantly from the point of view of the stock market, expanded profits. Now they will not, and the process works in reverse. Now the economy will be smaller and profits will be less.

Well that and once again, despite clear warnings from the credit rating agencies, DC decided not to enter rehab to address their spending addiction.........

Obama rejects his own debt commision's suggestions that would have kept this from happening and they haven't passed a budget in 840 days with Dems in total control most of that time, and they never even talked about cutting spending until the Republicans took back over to stop the out of control spending, and all they can do is want to blame those people who warned them of the fire and tried to put it out, while the Dems just wanted to add more fuel to it. They will never get it.

The Viking wrote:

PrintSmith wrote:

AspenValley wrote: From a CEO, not a pundit...

http://www.huffingtonpost.com/michael-k ... 21313.html

The stock market fell because last Tuesday night Congress approved, and President Obama signed, an agreement to cut public expenditures by $2.5 trillion over the next decade. That is the only significant change in the real world.

Those expenditures, which would have been financed entirely by borrowing money, would have put money in the pockets of defense contractors, road builders, home health care providers, school districts, and thousands of other companies, nonprofits, and individuals.

Those expenditures would have boosted the economy, expanded GNP, and, most importantly from the point of view of the stock market, expanded profits. Now they will not, and the process works in reverse. Now the economy will be smaller and profits will be less.

Well that and once again, despite clear warnings from the credit rating agencies, DC decided not to enter rehab to address their spending addiction.........

Obama rejects his own debt commision's suggestions that would have kept this from happening and they haven't passed a budget in 840 days with Dems in total control most of that time, and they never even talked about cutting spending until the Republicans took back over to stop the out of control spending, and all they can do is want to blame those people who warned them of the fire and tried to put it out, while the Dems just wanted to add more fuel to it. They will never get it.

Just wondering, does your ISP charge you per punctuation mark? And like ten times more for periods than commas?

archer wrote: I agree....not only are people buying treasuries, they are lowering their credit card debt and starting to actually save money again. Good for them, not so good for the economy which is consumer driven.

Last I knew today treasuries had a lower, not a higher, yield this morning as a result of S&P's decision. If you want to have money invested into the economy and not in treasuries there is a simple way to get that done, stop running up the federal deficit which makes the sale of new treasuries unnecessary, problem solved.

They are putting the money to use. They are not taking risks with it, but buying the federal debt is still putting the money to use. It just doesn't generate a lot of profit in the process, which is a good thing if you are trying to limit your exposure to having your gains taxed at a higher rate. They are still making some money on their investments, just not as much as they used to before being threatened with a tax rate increase. They will earn less than before, but really didn't need to make more money since they were already a millionaire or a billionaire with hundreds of thousands of dollars they didn't really need. Right now they are simply waiting for a more favorable risk/reward environment where one gets to keep more of what is returned for taking the risk instead of having DC keep more of it.

here's what I don't get ---

The rating went down (which means risk is up).

Why the heck did the yield on securities go down????
(the yield moves in the opposite direction of the price for a note)

My hunch - a deal was made - most likely between Treasury and the Fed -
to insulate federal notes/securities from further price erosion
(market manipulation).

Hmmm... "Obama rejects his own debt commission's suggestions"? Another Viking lie... (But then, there are so many...)

A) Obama didn't get to vote on the Debt Commission.
The vote needed to have 14 YES votes to be brought to the floor...It got 11...


Debt Commission:

YES:
Erskine Bowles (co-chair)
Alan Simpson (co-chair)
Dick Durbin (D)
Kent Conrad (D)
John Spratt (D)
Tom Coburn (R)
Judd Gregg (R)
Mike Crapo (R)
Alice Rivlin (fmr Dir, OMB)
David Cote (CEO, Honeywell)
Ann Fudge (fmr CEO, Young & Rubicam)

NO:
Max Baucus (D)
Jan Schakowsky (D)
Xavier Becerra (D)
Dave Camp (R)
Paul Ryan (R)
Jeb Hensarling (R)
Andrew Stern (fmr Pres, SEIU)

Obama didn't reject anything... The commission didn't have the votes... The parties on BOTH sides split-voted...

I guess another case of teabagger "revisionist history"...

Needed 14 to get to the floor because that is what Obama's executive order, which created the commission, established as a ground rule, right? Democrats got to pick 12 of the 18 members and couldn't even get their own membership to support the recommendations made by the commission Obama created. Obama himself didn't take their recommendations to heart, in fact he ignored most of them when putting together his budget proposal that he sent to Congress. Pelosi about had a fit as did Reid. Pretty safe to say that the Democrats as a group rejected the recommendations of the commission, including the party leader sitting behind the desk in the Oval Office.

I didn't see, though perhaps I just missed it, Obama launching a campaign to implement the recommendations, did you LJ? It was his commission, populated by a majority of people that he and his party appointed and it got 50% of the votes of Republicans on the commission. Why then did it fail? If he had been able to lead the members of his own party, it would have had the 14 votes necessary since it received 3 Republican votes. That would have been 15 for with 3 against, right? The commission plan got a 5-1 endorsement from Obama's appointees - but the one vote against was from the union guy - of SEIU fame - the organization whose agenda was Obama's agenda according to his campaign remarks. Think that might be why his reception of the recommendations couldn't even be described as lukewarm?

Lessee... The final vote took place in December... Help me out here... Who took over control of the House 30 days later?... I wonder if you seriously think that with the Congress holiday vacation starting in a couple of days, if you really think that they could have somehow rushed it to the floor and through the House before the GOP took over?...Or do you just like to hear yourself pontificate?

LadyJazzer wrote: Lessee... The final vote took place in December... Help me out here... Who took over control of the House 30 days later?... I wonder if you seriously think that with the Congress holiday vacation starting in a couple of days, if you really think that they could have somehow rushed it to the floor and through the House before the GOP took over?...Or do you just like to hear yourself pontificate?

Lessee..... Obama didn't want it! Since it had no tax increases, (which even his own comission didn't think would be a big help), I am pretty sure they could have gotten the votes. But Obama 'reviewed' it until mid April then wanted to hear other ideas like the gang of 6. It was a done deal had he just said let's do it, like most good leaders would do. But he likes to keep kicking things down the road to see if he can blame others.

AspenValley wrote:

The Viking wrote:

PrintSmith wrote:

AspenValley wrote: From a CEO, not a pundit...

http://www.huffingtonpost.com/michael-k ... 21313.html

The stock market fell because last Tuesday night Congress approved, and President Obama signed, an agreement to cut public expenditures by $2.5 trillion over the next decade. That is the only significant change in the real world.

Those expenditures, which would have been financed entirely by borrowing money, would have put money in the pockets of defense contractors, road builders, home health care providers, school districts, and thousands of other companies, nonprofits, and individuals.

Those expenditures would have boosted the economy, expanded GNP, and, most importantly from the point of view of the stock market, expanded profits. Now they will not, and the process works in reverse. Now the economy will be smaller and profits will be less.

Well that and once again, despite clear warnings from the credit rating agencies, DC decided not to enter rehab to address their spending addiction.........

Obama rejects his own debt commision's suggestions that would have kept this from happening and they haven't passed a budget in 840 days with Dems in total control most of that time, and they never even talked about cutting spending until the Republicans took back over to stop the out of control spending, and all they can do is want to blame those people who warned them of the fire and tried to put it out, while the Dems just wanted to add more fuel to it. They will never get it.

Just wondering, does your ISP charge you per punctuation mark? And like ten times more for periods than commas?

"Is that supposed to be funny? Because it isn't. It's just juvenile, like your friends in Congress."

towermonkey wrote:

AspenValley wrote:

The Viking wrote:

PrintSmith wrote:

AspenValley wrote: From a CEO, not a pundit...

http://www.huffingtonpost.com/michael-k ... 21313.html

The stock market fell because last Tuesday night Congress approved, and President Obama signed, an agreement to cut public expenditures by $2.5 trillion over the next decade. That is the only significant change in the real world.

Those expenditures, which would have been financed entirely by borrowing money, would have put money in the pockets of defense contractors, road builders, home health care providers, school districts, and thousands of other companies, nonprofits, and individuals.

Those expenditures would have boosted the economy, expanded GNP, and, most importantly from the point of view of the stock market, expanded profits. Now they will not, and the process works in reverse. Now the economy will be smaller and profits will be less.

Well that and once again, despite clear warnings from the credit rating agencies, DC decided not to enter rehab to address their spending addiction.........

Obama rejects his own debt commision's suggestions that would have kept this from happening and they haven't passed a budget in 840 days with Dems in total control most of that time, and they never even talked about cutting spending until the Republicans took back over to stop the out of control spending, and all they can do is want to blame those people who warned them of the fire and tried to put it out, while the Dems just wanted to add more fuel to it. They will never get it.

Just wondering, does your ISP charge you per punctuation mark? And like ten times more for periods than commas?

"Is that supposed to be funny? Because it isn't. It's just juvenile, like your friends in Congress."

I just ignore some of the ignorant comments on here. I just consider the source and realize they really don't have much else.