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U.S. loses AAA credit rating from S&P

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posted on Aug, 8 2011 @ 09:58 AM
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Originally posted by burdman30ott6

Originally posted by MrXYZ
reply to post by Aim64C
 





Entitlement spending accounts for the single greatest expenditure in the U.S. budget system - without including Social Security.


If you look at the Bush tax cuts as "entitlement spending"...sure


They are the largest single-policy contributor to the national debt...


Hmmm... how can a tax cut be a debt? Nobody ever has managed to answer that simple question. Are you suggesting that money belongs to the Federal government rather than to the men & women who earned it? At what point do you embrace the concept of a man owning the fruit of his own labors? Why not just start taxing everyone at 100% of their earnings, then cutting down to whatever level sustains the government's assinine redistribution of wealth habit and then the only debt on their books will be whatever percentage the government graciously allows the citizenry to keep?

ITS NOT THE GOVERNMENT'S DAMN MONEY!

The G.D. income tax isn't even Constitutionally legal to begin with.


They were introduced as tax breaks...last I checked, a "break" is temporary. Either way, it's clear the US can't afford those cuts right now. According to the IMF, spending needs to be cut around 33%, and revenues need to increase by around 35%. It's pretty clear that cutting the budget by 68% is IMPOSSIBLE...so tax increases (and/or ending tax loop holes...something the GOP is totally opposed against) are necessary if you look at the figures objectively.

But don't believe me, hope the US continues as it does now, and look what'll happen to its economy and markets




posted on Aug, 8 2011 @ 11:43 AM
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reply to post by burdman30ott6
 


Is it time to move to Costa Rica?
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When Obama is thrown out of office we can come back and pick up the pieces.
It looks like socialism doesn't work.



posted on Aug, 8 2011 @ 11:54 AM
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See this is why we the people should march down to DC unified carrying buckets of TAR and FEATHERS and do what needs to be done once and for all.

These self serving, greedy, idiotic, childish politicians did not seem to get when WE THE PEOPLE said work it out NOW! Even when S&P lowered our credit rating and flat out told them it was because they lost confidence in our own Governments ability to govern properly. What is their first response! "S&P step over their bounds and are wrong"
They can not even admit they EF-ed UP!

The S&P where trying to help lead them in the right direction and this is how they respond. For Gods Sake we should call for impeachment across the board and start listening to Ron Paul!!!

edit on 8/8/2011 by CaptGizmo because: (no reason given)

edit on 8/8/2011 by CaptGizmo because: (no reason given)



posted on Aug, 8 2011 @ 12:53 PM
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reply to post by CaptGizmo
 


It's really quite laughable. When S&P didn't act when the Lehman problems appeared, they were bad...and now that they're doing the right thing, they are being portrayed as bad again. And in my opinion, S&P waited WAY too long with the downgrade.



posted on Aug, 8 2011 @ 01:04 PM
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As I see it's all bull there is an agenda they adhere to and nothing is going to interfere with it....... plain and simple.

Whatever is to be will be....... it is what it is...... sadly!



posted on Aug, 8 2011 @ 01:20 PM
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Originally posted by MrXYZ
reply to post by CaptGizmo
 


It's really quite laughable. When S&P didn't act when the Lehman problems appeared, they were bad...and now that they're doing the right thing, they are being portrayed as bad again. And in my opinion, S&P waited WAY too long with the downgrade.


The S&P downgrade can be TAPS or a Reveille.
If we continue down the Obama socialist path then i see much more pain soon.
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The only solution is Free Market Capitalism.



posted on Aug, 8 2011 @ 01:41 PM
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reply to post by Eurisko2012
 





The only solution is Free Market Capitalism


Name me 1 country that truly follows free market capitalism


It's a THEORETICAL concept, but there's not a single country practicing it...and often for good reason. The free market principle only works if people act RATIONALLY, it's a cornerstone of that theory. But in reality, we know for a FACT people don't act rationally. Ergo, it's never gonna work



posted on Aug, 8 2011 @ 01:50 PM
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Originally posted by Aim64C
reply to post by Observor
 


May be spending priorities are to be decided by the Congress as per the US Constitution, but Obama was in no mood to oblige that part of the Constitution if it exists.

Perhaps he was bluffing, but no one wanted to take that risk.


So... what you are saying is: "because our president just don't gaheet it, we should give him another credit card."

Brilliant!

Nope, I am not saying anybody should give another credit card. The Congress chose the more debt option over the default/higher taxes options. Obama blackmailed the Congress into giving him more money through increased debt rather than higher taxes (he didn't care which way he got the money), by saying unless he gets the money he wants he will put the country in default which he knew no one wanted.

That said - if Obama, somehow, made us default on our payments (how, I have no clue - I am just humoring your assertion) because we wouldn't extend his credit limit.... how is that our problem? Sure - 'we' elected the guy - and if he's going to behave irresponsibly in our presidential office, then he needs to be told to leave - post-haste.

Simple as that.

It is not that difficult to imagine how Obama could have made the US default on its payments, simply by not paying the interest due on the existing bonds!

Again, you may not believe it is your problem, the members of the Congress did, as people responsible for running a country should. They thought a default by choice was a worse option than borrowing more and default later when there is no choice left!

Anyway, if you don't consider a default your problem, why is a higher debt (with a default pushed into future) your problem?

You do realize that the bottom 60% of the income segment does not pay effective taxes, correct? By time you figure in the amount of benefits received from government spending and compare it to the amount of money paid in - only the top 40% of -wage earners- pay effective tax.

And you're wanting to shift even greater tax burden upon them. Why?

I do know who shares the tax burden and to what extent. And no, I am not advocating pushing greater burden onto those already carrying the full burden of the taxes.

But somebody has to and those voting Obama won't take it either through taxation or through reduced entitlements. So Obama blackmailed the Congress into pushing the burden onto any suckers willing to buy US treasury bonds.


I don't think anyone there is foolish enough to believe this borrow and spend can continue indefinitely and most of them probably realise the game is very near the end. However, no one has the guts to come out and say they are not going to cut spending because they chose not to borrow and not raise taxes on the rich. So it will go on until it is proven that no one would lend the US government money, which is perhaps likely very soon.


Because, you know... when you start making money, it is my responsibility to come along and make sure you pay to feed people without a job.

Not in the least! But if you choose to and you are stronger, you leave me with two choices (1) succumb and lose part of what I earn and spend the rest as I please or (2) fight you back and lose part of what I earn to the fight to defend my right spend the rest as I please.

As you can see, the very presence of a person who intends to take what is not his, makes the others make a choice between two situations which are both a loss.

Really - if this is your standpoint - we are at an ideological impasse. Let it be known that your attempts to force this type of system upon the nation are an overt attack on the Constitution and the freedoms it establishes. Failure to heed warning will result in your classification as a threat.

You might have realised by now that we are not really at any ideological impasse. But my ideology, whatever it is, is completely immaterial since I am neither a US citizen nor a resident. Although I did live in the US for a few years, I left it, am glad for having done so and won't even be stepping on the US soil for any reason whatsoever. So you have no threat from me, save any remarks I make on internet forums like this


As for anyone "forcing" that system on US, I am surprised you don't realise that is exactly what you have and had for at least 80 years now. The US Constitution has been operative only selectively for even longer than that.



mpact of any voluntary spending cuts would not be any less significant than those you envisage with a 50% hike in taxes. Precisely why everyone agreed to borrow.


Government spending cuts on income subsidies would have little effect on the circulating economy. The largest impact would reside in the banking system where loans would become less frequent and fewer government subsidies were funneled straight into debt payments (where do most people put their income tax returns and designated large parts of their social security supplement checks?)

Taxing the bejesus out of the population to subsidize a 50% increase in government spending is absolutely ridiculous. States will secede and militias will incapacitate federal infrastructure in a heartbeat. You've simply no idea what kind of contingencies are in place.

I was not referring to the impact on the economy, but the impact on the society.

All entitlements in the US are protection money you pay those receiving them to keep them from not causing too much harm/nusaince to the rest.

So if you cut the entitlements, you are risking a complete societal collapse.



posted on Aug, 8 2011 @ 02:00 PM
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People still take the S&P seriously? After the way they have rated other countries while they knew that they were bad investments. They even made an error in their calculations and people here take them seriously. Oh They are only taken seriously when the doomers here agree with it. Other wise they are lieing banisters.

Why S.&P.’s Ratings Are Substandard and Porous



posted on Aug, 8 2011 @ 02:09 PM
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Originally posted by gorgi
People still take the S&P seriously? After the way they have rated other countries while they knew that they were bad investments. They even made an error in their calculations and people here take them seriously. Oh They are only taken seriously when the doomers here agree with it. Other wise they are lieing banisters.

Why S.&P.’s Ratings Are Substandard and Porous


Believe me. All of the other rating agencies are right behind S&P.
We need to reduce government spending.
The debt deal failed to do that.
----------------
Just look at the numbers.
We are spending $4 billion a day!
This is nuts!
---------------
I'll be glad when we turn this page in history.



posted on Aug, 8 2011 @ 02:13 PM
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Originally posted by MrXYZ
The free market principle only works if people act RATIONALLY, it's a cornerstone of that theory. But in reality, we know for a FACT people don't act rationally. Ergo, it's never gonna work

Not sure what you mean by it "working". Free Market Capitalism never promises anything for it to not work. For those who advocate it, it is not a means to an end, but an end in itself.



posted on Aug, 8 2011 @ 02:21 PM
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reply to post by Observor
 


Either way, it's a theoretical concept that says "participants have to act rationally"...which just isn't realistic. You can get something close to free market capitalism, but you will NEVER see the full theory put into practice



posted on Aug, 8 2011 @ 02:44 PM
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Originally posted by MrXYZ
reply to post by Observor
 

Either way, it's a theoretical concept that says "participants have to act rationally"...which just isn't realistic. You can get something close to free market capitalism, but you will NEVER see the full theory put into practice

There is nothing irrational about a corporation getting a government to make laws that benefit it and not the competition or some guys getting the government to tax others to give them freebies. Those are perfectly rational decisions, but not in tune with free market. So everyone acting rationally may still not lead to a free market if everyone doesn't value free market above all else.



posted on Aug, 8 2011 @ 02:45 PM
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reply to post by Observor
 


If you create artificial government created barriers and policies it's NOT a free market anymore


To give you an example of irrationality:

Groupon made almost half a billion in losses...but is being valued at 50bil+!! THAT'S why free market will never work, the participants don't act rationally...
edit on 8-8-2011 by MrXYZ because: (no reason given)



posted on Aug, 8 2011 @ 03:37 PM
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Originally posted by MrXYZ
reply to post by Observor
 

If you create artificial government created barriers and policies it's NOT a free market anymore

Of course, it is not a free market. But it is a perfectly rational decision for the guys benfitting from it. Rational doesn't necessarily lead to free market is what I have been saying.

To give you an example of irrationality:

Groupon made almost half a billion in losses...but is being valued at 50bil+!! THAT'S why free market will never work, the participants don't act rationally...
edit on 8-8-2011 by MrXYZ because: (no reason given)

Company valuations are not based exclusively on a particular year's performance. That valuation may or may not be rational, I don't know.

Again I am not sure what you mean by free markets not "working". Nothing is promised by free market. So yes, people can irrationally overvalue a company, invest in it and then lose all their investment if the company goes bankrupt and is liquidated. If that happens, it is still an example of free markets "working", not an example of free markets "not working".



posted on Aug, 8 2011 @ 04:11 PM
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posted on Aug, 8 2011 @ 04:18 PM
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America's Credit rating survived Great Depression, but not two years of Obama



posted on Aug, 8 2011 @ 04:41 PM
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reply to post by Observor
 



Nope, I am not saying anybody should give another credit card. The Congress chose the more debt option over the default/higher taxes options. Obama blackmailed the Congress into giving him more money through increased debt rather than higher taxes (he didn't care which way he got the money), by saying unless he gets the money he wants he will put the country in default which he knew no one wanted.


I seriously, seriously doubt the President has that much authority. As I understand - the President presents a budget before Congress and has it approved - but Congress still 'owns' the budget and has the authority to do with it as they will. The Executive branch, among all of the branches, is supposed to have the least amount of power.


It is not that difficult to imagine how Obama could have made the US default on its payments, simply by not paying the interest due on the existing bonds!


At that point, it's not our problem.


Anyway, if you don't consider a default your problem, why is a higher debt (with a default pushed into future) your problem?


Presuming, for a moment, you are correct about Obama being able to choose to default... how is therefor 'responsible' to cave? Let him default on those payments. His own security agents wouldn't be able to provide security at that point. Hell, the man would make fewer enemies by proclaiming he's a member of the Black Panthers and taunting the white supremacists.

It's not my problem what he decides to do with the budget.

www.outsidethebeltway.com...

However, it's a pointless issue. The President can't do it:


“‘The validity of the public debt of the United States, authorized by law, including debts incurred for the payments of pension and bounties for services in suppressing insurrection or rebellion’ — this is the important thing — ‘shall not be questioned,” Geithner read.

“So as a negotiating strategy you say: ‘If you don’t do things my way, I’m going to force the United States to default–not pay the legacy of bills accumulated by my predecessors in Congress.’ It’s not a credible negotiating strategy, and it’s not going to happen,” Geithner insisted.



If Wade’s speech offers the central rationale for Section Four, the goal was to remove threats of default on federal debts from partisan struggle. Reconstruction Republicans feared that Democrats, once admitted to Congress would use their majorities to default on obligations they did disliked politically. More generally, as Wade explained, “every man who has property in the public funds will feel safer when he sees that the national debt is withdrawn from the power of a Congress to repudiate it and placed under the guardianship of the Constitution than he would feel if it were left at loose ends and subject to the varying majorities which may arise in Congress.”


Slam, bam, thank you, ma'am.

The President cannot choose to default. Not even Congress could choose to default. Public debts are paid first and foremost as they are a direct investment by the citizens.

Though it would be fun to see Obama get absolutely owned in the Supreme court... since he's a "constitutional scholar" and all.


I do know who shares the tax burden and to what extent. And no, I am not advocating pushing greater burden onto those already carrying the full burden of the taxes.

But somebody has to and those voting Obama won't take it either through taxation or through reduced entitlements. So Obama blackmailed the Congress into pushing the burden onto any suckers willing to buy US treasury bonds.


Missing the forest for the trees, there, 'observor.'

First, there's no risk of default. At present, the U.S. has plenty of revenue to cover its public debts and necessary functions. It does not, however, have the revenue to continue entitlement programs - at least, nothing like they are today.

The problem is that people are not willing to do what is necessary and are too busy concocting little games and coming up with excuses to try and make each other look bad.

It's pathetic. It reminds me of a 'random event' in Galactic Civilizations II: "Bug wars? Seriously? I mean, you can't make this stuff up. What do you do with bugs? You exterminate them!"

Or: "Dust off and nuke the site from orbit, it's the only way to be sure!"

Watching this nonsense is enough to make me want to disown the human race.


As you can see, the very presence of a person who intends to take what is not his, makes the others make a choice between two situations which are both a loss.


I can guarantee you a bullet to his head is far less of a loss than a lifetime of thievery.

Put that in the context of society.


As for anyone "forcing" that system on US, I am surprised you don't realise that is exactly what you have and had for at least 80 years now. The US Constitution has been operative only selectively for even longer than that.


Oh, trust me, I'm none too pleased with the way our prior three generations handled the government.

The fact is that we are accelerating toward that system even faster. I see where we are going and find it completely unacceptable and have drawn a line in the sand. Beyond that point, peaceful recourse is no longer an option and everything will be settled by contests of attrition.


All entitlements in the US are protection money you pay those receiving them to keep them from not causing too much harm/nusaince to the rest.

So if you cut the entitlements, you are risking a complete societal collapse.


If you haven't noticed, I would welcome a justifiable reason to remove these voting demographics permanently. That's pretty damned sadistic - but I really don't have the patience to deal with people who say: "pay us money for food or we riot." Go ahead... make my day.

We keep paying them "protection money" and drive our country into ruin or we cut off the "protection money" and slaughter them when they riot. Which one sounds more entertaining to a young, unmarried man with martial arts and weapons training?

At least when we get done dealing with the thugs, I can return to a relatively intact and peaceful society and integrate with it once again. Afterward, we can take care of those who need help and do not stoop to thuggish behavior.



posted on Aug, 8 2011 @ 05:29 PM
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Originally posted by Eurisko2012

Originally posted by gorgi
People still take the S&P seriously? After the way they have rated other countries while they knew that they were bad investments. They even made an error in their calculations and people here take them seriously. Oh They are only taken seriously when the doomers here agree with it. Other wise they are lieing banisters.

Why S.&P.’s Ratings Are Substandard and Porous


Believe me. All of the other rating agencies are right behind S&P.
We need to reduce government spending.
The debt deal failed to do that.
----------------
Just look at the numbers.
We are spending $4 billion a day!
This is nuts!
---------------
I'll be glad when we turn this page in history.


Thats incorrect , Moodys and Fitch are both going to keep the AAA status for the USA. They have already said that.



posted on Aug, 9 2011 @ 01:23 AM
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Originally posted by Aim64C
reply to post by Observor
 



Nope, I am not saying anybody should give another credit card. The Congress chose the more debt option over the default/higher taxes options. Obama blackmailed the Congress into giving him more money through increased debt rather than higher taxes (he didn't care which way he got the money), by saying unless he gets the money he wants he will put the country in default which he knew no one wanted.


I seriously, seriously doubt the President has that much authority. As I understand - the President presents a budget before Congress and has it approved - but Congress still 'owns' the budget and has the authority to do with it as they will. The Executive branch, among all of the branches, is supposed to have the least amount of power.

You are right. But the budget has already been passed and spending authorised by the Congress. However, the revenue flow was much less than expected and hence the treasury ran out of money to spend as the Congress authorised it. At that point the executive has no choice but to dishonour some of the spending already authorised by the Congress, it could be interest payments on debt or entitlements. If the Congress doesn't explicitly cut one of them or allow the executive to borrow more, the executive can do as it pleases. Whether that is "constituional" or not is immaterial. The executive cannot be held responsible for the irresponsibility of the Congress which cannot show the money for the spending it authorised.


It is not that difficult to imagine how Obama could have made the US default on its payments, simply by not paying the interest due on the existing bonds!


At that point, it's not our problem.

Not sure, who the 'we' in the 'our problem' is. It is certainly the problem of everyone running the show in the US.


Anyway, if you don't consider a default your problem, why is a higher debt (with a default pushed into future) your problem?


Presuming, for a moment, you are correct about Obama being able to choose to default... how is therefor 'responsible' to cave? Let him default on those payments. His own security agents wouldn't be able to provide security at that point. Hell, the man would make fewer enemies by proclaiming he's a member of the Black Panthers and taunting the white supremacists.

It's not my problem what he decides to do with the budget.

It is the irresponsibility of the Congress to authorise spending for which there is no revenue. Their "caving in" was simply correcting their previous irresponsibility.

Slam, bam, thank you, ma'am.

The President cannot choose to default. Not even Congress could choose to default. Public debts are paid first and foremost as they are a direct investment by the citizens.

Though it would be fun to see Obama get absolutely owned in the Supreme court... since he's a "constitutional scholar" and all.

One person's opinion on the constitutionality of such an action by the executive is immaterial. Yes, Obama was prepared for the issue being taken to the courts. I very much doubt the courts would have faulted the President for choosing which obligations to meet first when there wasn't enough to meet all of them, as authorised by the Congress.

In any case, it is an irretrievable step. Courts may rule that Obama acted unconstitutionally and remove him from power, but the damage would already have been done.


Missing the forest for the trees, there, 'observor.'

First, there's no risk of default. At present, the U.S. has plenty of revenue to cover its public debts and necessary functions. It does not, however, have the revenue to continue entitlement programs - at least, nothing like they are today.

All the spending has already been authorised by the Congress. It is their responsibility to show where the money to spend will come from.

The problem is that people are not willing to do what is necessary and are too busy concocting little games and coming up with excuses to try and make each other look bad.

It's pathetic.

Sure it is.


As you can see, the very presence of a person who intends to take what is not his, makes the others make a choice between two situations which are both a loss.


I can guarantee you a bullet to his head is far less of a loss than a lifetime of thievery.

Put that in the context of society.

The bullet still costs you and you won't need it if that guy hadn't been around. That is what I meant by a lose/lose situation.


As for anyone "forcing" that system on US, I am surprised you don't realise that is exactly what you have and had for at least 80 years now. The US Constitution has been operative only selectively for even longer than that.


Oh, trust me, I'm none too pleased with the way our prior three generations handled the government.

The fact is that we are accelerating toward that system even faster. I see where we are going and find it completely unacceptable and have drawn a line in the sand. Beyond that point, peaceful recourse is no longer an option and everything will be settled by contests of attrition.

Exactly! So there isn't much point in looking to the existing institutions to correct generations of misbahaviour.

If you haven't noticed, I would welcome a justifiable reason to remove these voting demographics permanently. That's pretty damned sadistic - but I really don't have the patience to deal with people who say: "pay us money for food or we riot." Go ahead... make my day.

We keep paying them "protection money" and drive our country into ruin or we cut off the "protection money" and slaughter them when they riot. Which one sounds more entertaining to a young, unmarried man with martial arts and weapons training?

At least when we get done dealing with the thugs, I can return to a relatively intact and peaceful society and integrate with it once again. Afterward, we can take care of those who need help and do not stoop to thuggish behavior.

It is not what you welcome that determines the course of things, but what you are willing to do.

You are right, the young and able don't mind a total disruption to change course. But older ones do. It is the collective of all such preferences that determines the course.



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