Breaking: Moody's may downgrade U.S. triple-A rating!

Moody's Investors Service said late Wednesday it placed the U.S. government's triple-A bond rating on review for possible downgrade due to rising risk of default. "The review of the U.S. government's bond rating is prompted by the possibility that the debt limit will not be raised in time to prevent a missed payment of interest or principal on outstanding bonds and notes. As such, there is a small but rising risk of a short-lived default," Moody's said. The rating agency stressed that it considers the probability of a default to be low but no longer minimal. "An actual default, regardless of duration, would fundamentally alter Moody's assessment of the timeliness of future payments, and a Aaa rating would likely no longer be appropriate," it added. Moddy's said the rating, if lowered, would most likely be somewhere in the Aa range.

Moody's may downgrade U.S. triple-A rating

So congress, better pull your finger out now Moody's has the US triple A rating on review for downgrade if the debt limit is not raised in time to prevent a missed payment.

In other news.
Moody's CEO was just arrested for raping an underage female.
And more victims may be coming forth to press charges.

Good luck to them.

reply to post by surrealist


Yes we already know S&P may downgrade the US, since you are not from the US and from Australia you arent immune to the consequences. Why are you laughing? Just curious... It would cause a global fall-out instantly.

It has already been proven that even if the debt ceiling is not raised we still bring in plenty to cover most if not all payments going out. This is just more posturing and fear mongering to try and force them to raise the debt ceiling so they can keep on spending.

Originally posted by grey580
In other news.
Moody's CEO was just arrested for raping an underage female.
And more victims may be coming forth to press charges.

Good luck to them.

Sounds like the IMF rape scandal. Now I'm beginning to think there is a monetary link between these.

reply to post by SpaDe_


Without more money, how do you think we can continue to pay?
Additionally, if we default, for even a second, that portion of our money which goes to pay the interest on our outstanding debt will have to increase becasue just like someone with bad credit gets the bum end at the car dealership, well, the U.S. will now have to pay higher percentages for every loan.

I am not aruuging the philosophy behind our need to stop being such an extreme debtor nation: we do need to stop that. But, we also have to honor our current bills and that is not going to happen without raising the debt ceiling. The budget has already been passed, for all intents and purposes that money is already spent.

The arguments about what to fund, not fund, tax, not tax, next time around are worth having. But a political showdown that just causes our interests rates to go up because of a default is a pissing contest that only ends up costing American citizens. If they allow that to happen every last one of them from both parties and all offices should be tossed at the first legal opportunity and means to do so.

reply to post by watcher3339


Here is a piece from Marketwatch on the subject. It is definitely worth the read. I think it is in another thread here as well. It just shows how they are going on about default when it isn't even a possibility at this point.

Despite all the rhetoric and posturing we see in the media and in Washington D.C., it is safe to say categorically that the U.S. Treasury will not default on its debt after August 2nd, even if the debt ceiling is not raised. Not only will the Treasury be able to pay interest on U.S. debt obligations, but there is money for other essential programs as well. However, there will be some serious cutting that has to happen because spending clearly exceeds revenues.

Source

Originally posted by watcher3339
reply to post by SpaDe_

 

Without more money, how do you think we can continue to pay?
Additionally, if we default, for even a second, that portion of our money which goes to pay the interest on our outstanding debt will have to increase becasue just like someone with bad credit gets the bum end at the car dealership, well, the U.S. will now have to pay higher percentages for every loan.

I am not aruuging the philosophy behind our need to stop being such an extreme debtor nation: we do need to stop that. But, we also have to honor our current bills and that is not going to happen without raising the debt ceiling. The budget has already been passed, for all intents and purposes that money is already spent.

The arguments about what to fund, not fund, tax, not tax, next time around are worth having. But a political showdown that just causes our interests rates to go up because of a default is a pissing contest that only ends up costing American citizens. If they allow that to happen every last one of them from both parties and all offices should be tossed at the first legal opportunity and means to do so.

edit on 13-7-2011 by watcher3339 because: (no reason given)

Please see this thread covering the topic earlier. Not increasing the debt ceiling does NOT mean default, it means they can't go further in debt. We've got enough money to meet obligations for the time being and they can also simply decide to not go further in debt by continuing to spend even more money we don't have.

It's like you or I, with a maxed-out credit card. Instead of getting our spending under control and addressing the balance we've got, these knuckleheads want to keep calling the card company and getting their credit limit raised. This in ITSELF should be enough to downgrade our credit rating, honestly...but regardless, default is NOT what we're talking about here. They're just scare mongering to get the credit limit raised so they can max the card out yet again.

And it's all stupid.

Originally posted by SpaDe_
It has already been proven that even if the debt ceiling is not raised we still bring in plenty to cover most if not all payments going out. This is just more posturing and fear mongering to try and force them to raise the debt ceiling so they can keep on spending.

Reread your statement -- who has proved that -- and if the rating entity says that if we default they have no choice -- what difference does it make if we have enough money -- This is only an issue because the Republican base thinks that if they miss a credit card payment they just pay a small penalty next month so what is the big deal. I am really tired of short sighted simple minded people, pretending there is a simple answer for everything. Ask one of them to explain how this works -- really how it works stay for the comedy.

Originally posted by spyder550

Originally posted by SpaDe_
It has already been proven that even if the debt ceiling is not raised we still bring in plenty to cover most if not all payments going out. This is just more posturing and fear mongering to try and force them to raise the debt ceiling so they can keep on spending.

Reread your statement -- who has proved that -- and if the rating entity says that if we default they have no choice -- what difference does it make if we have enough money -- This is only an issue because the Republican base thinks that if they miss a credit card payment they just pay a small penalty next month so what is the big deal. I am really tired of short sighted simple minded people, pretending there is a simple answer for everything. Ask one of them to explain how this works -- really how it works stay for the comedy.

Maybe you should do some research.

The BPC study found that the United States is likely to hit the debt limit sometime between August 2 and August 9. “It’s a 44 percent overnight cut in federal spending” if Congress hits the debt limit, [BPC's Jay] Powell said. The BPC study projects there will be $172 billion in federal revenues in August and $307 billion in authorized expenditures.
That means there’s enough money to pay for, say, interest on the debt ($29 billion),
Social Security ($49.2 billion), Medicare and Medicaid ($50 billion), active duty troop pay ($2.9 billion),
veterans affairs programs ($2.9 billion).
That leaves you with about $39 billion to fund (or not fund) the following: Defense vendors ($31.7 billion) IRS refunds ($3.9 billion) Food stamps and welfare ($9.3 billion) Unemployment insurance benefits ($12.8 billion) Department of Education ($20.2 billion) Housing and Urban Development ($6.7 billion) Other spending, such as Departments of Justice, Labor, Commerce, EPA, HHS ($73.6 billion) The decision to prioritize payments would fall on the Treasury department, and Powell points out it would be chaotic picking and choosing who gets paid (in full or partially) and who doesn’t…

Source

It is the beginning of the end. It starts here. If I were you I'd go out and buy your NBC Gas Masks and stock up on bottled water and tinned food. Oh and find a nice granite cave to live in. It is here, we are all fooked. I just hope that it will be quick and painless for most.

It's hard to say who has lost more credibility over the last few years: agencies like Moodys, or the US government. Both sets of clowns are shadows of their former selves, integrity-wise. So it really doesn't matter what one says about the other anymore. The investment community, both within the US and abroad, ultimately votes with its feet...and its wallets.

Just remember, our fiat currency is backed by the full faith and CREDIT of the US government. How much is that fiat currency worth when the credit is devalued and when added to QE1 and QE2?

reply to post by SpaDe_


I read your link. And their source link. Excellent and informative on a topic that has been rather muddy and hard to pin down. Now, there are still various ways to interpret what will happen in regard to the money that we have available.
Do you, or any one else, have an equally solid info about whether rating agencies would consider us in default or downgrade us if we made the payments but the debt ceiling wasn't raised (robbed Peter to pay Paul)?

Also, couldn't it be interpreted that this equates to a Republican Revolution of sorts? Rather than voting each issue they disagree with one at a time, they got money extended for the troops and then just dig in and allow the Federal Government to be largely shut down?

I had posted about this question and my thoughts/feelings (mixed) during the budget showdown.

Bloodless Coup

Again, thank you for your link. I really am over a fence on all of this. I think it is hugely important, and your information was helpful and appreciated.

Originally posted by wonderworld
reply to post by surrealist

 

Yes we already know S&P may downgrade the US, since you are not from the US and from Australia you arent immune to the consequences. Why are you laughing? Just curious... It would cause a global fall-out instantly.

I realise that it would cause a global fallout but I honestly don't see the political theater extending beyond the due date and a compromise will be reached and the debt ceiling will be raised in time. US politicians are creating a lot of anxiety (and perhaps rightly so) around the debt and deficits, but the way I see it, it is an effective sales pitch to the constituency for forthcoming austerity, in fact the best sales hype across the world. Many Americans appear to already be supporting austerity, many on the conservative side at least anyway.

Now the reason why I was laughing and a little jovial about the matter is as I stated - I don't believe congress will remain in a stalemate beyond the deadline. However, should they do, then the consequences will be likely very adverse. The other reason is because of accusations of 'fear mongering'. So I try to avoid posting much in a manner that would be seen to be FEAR MONGERING! It seems just about any opinion posted on this forum is criticised to buggery as either fear mongering or otherwise picked up on and criticised for something else.

i think this is the 3rd or 4th time moody has said this. GO and DO IT ALREADY!

reply to post by watcher3339


No problem at all for the info. Sometimes it just takes reading it for yourself to understand that the picture that is being painted for all of us (the general public) is not always an accurate portrait of what is really going on.

Originally posted by wonderworld

Originally posted by grey580
In other news.
Moody's CEO was just arrested for raping an underage female.
And more victims may be coming forth to press charges.

Good luck to them.

Sounds like the IMF rape scandal. Now I'm beginning to think there is a monetary link between these.

Dont forget the head of the Afghanistan central bank fleeing to the U.S and Indian central banker close to DSK being jailed for attempted rape as well. lots of cross stories here

reply to post by surrealist


Moodys? You mean the rating agencies that gave house debt AAA staus until (and even after) the housing market imploded?

Yeah, they're just part of the ponzi parade too

So. They cannot pay SS, SSDI or veterans, but they can bail out again?

Really?

www.cnbc.com...

Bernanke: Fed May Launch New Round of Stimulus

Someone help me out here, I am confused. We have the money, or we don't. The dollar weakens, so we are going to print more money to prop it up, but let half the country go without food?

They have admitted the first rounds of stimulus failed, so they are going to do it again? What was that bluster about someone elses "failed policies"?

So they are going to blow how many billions to buy bonds, that are about to be downgraded? And, they are buying them from themselves... so... who really owes who what? Kinda looks like no one owes anyone anything?

www.abovetopsecret.com...


Really?