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Thread: Moody's Warns It May Downgrade US Credit Rating

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    Moody's Warns It May Downgrade US Credit Rating

    From CNBC:

    The United States may lose its top-notch credit rating in the next few weeks if lawmakers fail to increase the country's debt ceiling, forcing the government to miss debt payments, Moody's Investors Service warned Wednesday.

    Moody's is the first of the big-three rating agencies to place the United States' Aaa rating on review for a possible downgrade, which means it is close to cutting its rating.
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    IMO, this move is wholly justified. The U.S.--intense finger-pointing and attempts at blame-shifting by all parties notwithstanding--is acting in a fashion that suggests that it is not a AAA state. Outcomes, not excuses, matter. As such, the U.S. bears, and ought to bear, the burden of proving that it deserves to maintain its AAA rating. To do so, I believe the debt ceiling needs to be raised with a modest fiscal consolidation package.

    Afterward, over the next 6-12 months it has to adopt a credible fiscal consolidation strategy and it must put in place mechanism to address its present political dysfunctionality. The former would show that it is addressing is credit-related issues. The latter would provide a degree of confidence that the U.S. would have a reasonable prospect of implementing and sustaining a credible fiscal consolidation program. Failure to raise the debt ceiling in a timely fashion and then failure to demonstrate significant progress on the other two elements 6-12 months afterward should lead to a credit downgrade to a level that better reflects its actual risk.

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    Re: Moody's Warns It May Downgrade US Credit Rating

    They've been threatening to do it for months.

    Where have you been?
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    Re: Moody's Warns It May Downgrade US Credit Rating

    Quote Originally Posted by Jeezy View Post
    They've been threatening to do it for months.

    Where have you been?
    I posted about it: http://www.debatepolitics.com/breaki...-progress.html

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    Re: Moody's Warns It May Downgrade US Credit Rating

    I think Obama should just tell them they can't.
    "He who does not think himself worth saving from poverty and ignorance by his own efforts, will hardly be thought worth the efforts of anybody else." -- Frederick Douglass, Self-Made Men (1872)
    "Fly-over" country voted, and The Donald is now POTUS.

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    Re: Moody's Warns It May Downgrade US Credit Rating

    Raise the limit or not there is absolutely zero reasons why we should miss a debt payment. Paying Pakistan and bombing Libya is not a debt we owe.

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    Re: Moody's Warns It May Downgrade US Credit Rating

    Im not going to pretend I understand all the inner workings, but as I understand it not only is there no risk of us not paying our debt, but (again, as I understand it) by law we MUST pay our debt first and there is plenty of money to pay the interest on the debt, medical costs, social security, etc. However there is a ton of other programs we are in danger of not paying that is what is at risk. Fed employees...foreign assistance, highway funds, etc. All extending ourt debt ceiling will do is enable us to go deeper in debt and that WILL put us at risk of eventually not being able to pay.

    Look...we are incurring a trillion plus in new debt every YEAR. THAT is what is not sustainable. I believe they have their priority right (spending cuts FIRST) but in addition to MASSIVE cuts there is simply going to HAVE to be some form of increased taxation. Demonstrating fiscal responsibility with regard to spending will secure our credit rating. Until that happens...be honest...would YOU loan this government money???

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    Re: Moody's Warns It May Downgrade US Credit Rating

    Quote Originally Posted by VanceMack View Post
    Im not going to pretend I understand all the inner workings, but as I understand it not only is there no risk of us not paying our debt, but (again, as I understand it) by law we MUST pay our debt first and there is plenty of money to pay the interest on the debt, medical costs, social security, etc. However there is a ton of other programs we are in danger of not paying that is what is at risk. Fed employees...foreign assistance, highway funds, etc. All extending ourt debt ceiling will do is enable us to go deeper in debt and that WILL put us at risk of eventually not being able to pay.
    I think you're correct. All I'll add here is that even if we do hit the debt limit and don't default, interest rates on the Treasury bonds will still be driven up, compounding the problem. The government is basically going to face a whole host of choices, all of them extremely unpleasant.

    Look...we are incurring a trillion plus in new debt every YEAR. THAT is what is not sustainable. I believe they have their priority right (spending cuts FIRST) but in addition to MASSIVE cuts there is simply going to HAVE to be some form of increased taxation. Demonstrating fiscal responsibility with regard to spending will secure our credit rating. Until that happens...be honest...would YOU loan this government money???
    Agreed. The biggest obstacle to getting new revenue, however, is the weak state of the economy. (of course, different sides have radically different proposals about how to fix it).
    Nobody who wins a war indulges in a bifurcated definition of victory. War is a political act; victory and defeat have meaning only in political terms. A country incapable of achieving its political objectives at an acceptable cost is losing the war, regardless of battlefield events.

    Bifurcating victory (e.g. winning militarily, losing politically) is a useful salve for defeated armies. The "stab in the back" narrative helped take the sting out of failure for German generals after WWI and their American counterparts after Vietnam.

    All the same, it's nonsense. To paraphrase Vince Lombardi, show me a political loser, and I'll show you a loser.
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    Moody's Weighs Downgrading U.S. Credit Rating as Obama Says He 'Won't Yield' in Debt

    Moody's Weighs Downgrading U.S. Credit Rating as Obama Says He 'Won't Yield' in Debt Talks

    Leading credit rating agency Moody's said Wednesday that the U.S. government's impeccable credit rating was under review for a potential downgrade as tensions boil over in Washington with time running out to raise the nation's borrowing limit.

    President Obama walked out of high-level negotiations Wednesday, saying according to a Republican aide, "I've reached my limit. This may bring my presidency down, but I won't yield on this."
    I think it is time everyone accepts the fact that the person driving every political strategy for the Democrats right now is none other than the POTUS. This is where all responsibility lies and, as he so eloquently put it, “the buck stops here”. This is truer today than it has ever been.

    If Obama doesn’t get his tax hikes and spending increases, he will do what?

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    Quote Originally Posted by Montecresto View Post
    It would seem that the constitution is just a god damn piece of paper, to be trotted out when expedient.

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    Re: Moody's Weighs Downgrading U.S. Credit Rating as Obama Says He 'Won't Yield' in D

    Healthcare spending is ‘off the table’, tax cuts are ‘off the table’, refusal to spend more on stimulus is ‘off the table’, social security is ‘off the table’, Medicare is ‘off the table’, Libya is ‘off the table’, EPA Cap and Trade enforcement is ‘off the table’, and the list goes on and on.

    If the President really thinks it is better to refuse to pay social security recipients or our military personnel than it is to accept spending cuts as a condition for raising the debt ceiling, maybe he was lying about his vote against raising the debt ceiling as a US Senator.

    "Too often we enjoy the comfort of opinion without the discomfort of thought."
    John F. Kennedy
    Quote Originally Posted by Montecresto View Post
    It would seem that the constitution is just a god damn piece of paper, to be trotted out when expedient.

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    Re: Moody's Weighs Downgrading U.S. Credit Rating as Obama Says He 'Won't Yield' in D

    Obama "stormed out of the room" but promised to resume talks Thursday, the GOP aide said.
    "We are very far apart right now," House Majority Leader Eric Cantor said, calling Obama's exit from the talks Wednesday "abrupt."
    "He became very agitated, said 'Ronald Reagan wouldn't sit here. You either have to compromise on the dollar figure or the grand bargain,'" Cantor said. "He said, 'Don't call my bluff. I'm going to the American people on this.'"


    Read more: Moody's Weighs Downgrading U.S. Credit Rating as Obama Says He 'Won't Yield' in Debt Talks - FoxNews.com
    The only thing "on the table" seems to be "Raise Taxes, spend more" and he's very upset the GOP won't do his bidding.
    Climate, changes. It takes a particularly uneducated population to buy into the idea that it's their fault climate is changing and further political solutions can fix it.



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