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Thread: S&P tells White House it will downgrade U.S. rating

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    Re: S&P tells White House it will downgrade U.S. rating

    Quote Originally Posted by Jetboogieman View Post
    The lowering in Credit Rating means that your interest payments will go up, meaning you will pay more in the end. Had an effective solution been reached on the debt crisis, even with a massive cut in spending that may have even been harmful in some ways, you could have kept the credit rating and allowed the interest on your debt payments to stay as low as possible.
    Hey, I was all for that. You're preaching to the choir here.

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    Re: S&P tells White House it will downgrade U.S. rating

    Quote Originally Posted by donsutherland1 View Post
    The problem is that according to the empirical research, the ratings agencies are typically too slow to downgrade, not too fast.
    According to real life examples, they don't know a bad risk when it's staring them in the face. Remember, the credit agencies calling absolute garbage AAA is part of the reason we are in this mess.

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    Re: S&P tells White House it will downgrade U.S. rating

    Quote Originally Posted by 1Perry View Post
    Hey, I was all for that. You're preaching to the choir here.
    Fair enough bro.

    I think what really happened was that the choir was singing too many different tunes, and the choir master decided to go with the dumbest song possible to get the concert over with.

    Choir analogies end now.

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    Re: S&P tells White House it will downgrade U.S. rating

    Quote Originally Posted by Jetboogieman View Post
    All makes for a great campaign slogan but here's another question.

    How are you going to make this happen?
    by offering a preferential tax rate to corporations that employ a high percentage of their workforce here in the states. also, by ending the wars completely and immediately and reallocating those funds to infrastructure projects (including roads, bridges, and a massive upgrade of our electrical grid). money spent on some defense projects will also have to be reallocated.

    the upper individual tax rates will also have to be reconsidered, as will the ceiling on FICA. we should tweak both a little at a time until we find the correct balance.

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    Re: S&P tells White House it will downgrade U.S. rating

    Quote Originally Posted by Helix View Post
    by offering a preferential tax rate to corporations that employ a high percentage of their workforce here in the states. also, by ending the wars completely and immediately and reallocating those funds to infrastructure projects (including roads, bridges, and a massive upgrade of our electrical grid). money spent on some defense projects will also have to be reallocated.

    the upper individual tax rates will also have to be reconsidered, as will the ceiling on FICA. we should tweak both a little at a time until we find the correct balance.
    Some nice specifics there.

    Well its a plan, which is more I can say for the leadership at the moment.

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    Re: S&P tells White House it will downgrade U.S. rating

    Quote Originally Posted by 1Perry View Post
    According to real life examples, they don't know a bad risk when it's staring them in the face. Remember, the credit agencies calling absolute garbage AAA is part of the reason we are in this mess.
    The AAA rating they gave out during the 2000s were primarily due to conflicts of interests. They were being paid to help create the MBS's and have them achieve AAA rating. If they turned around and gave them less then a AAA rating they would have lost a huge amount of consulting business
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    Re: S&P tells White House it will downgrade U.S. rating

    The solution is massive reductions in spending across the board. MASSIVE spending cuts.
    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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    Re: S&P tells White House it will downgrade U.S. rating

    Quote Originally Posted by Lord Tammerlain View Post
    To my knowledge this should be a significant event.

    As some investments are only allowed to carry AAA rated investments, this depending on how the restrictions are written (which rating agencies and how many have to have the AAA rating still) could lead to a dumping of US government debt by private investors who will be scrambling to find AAA rated investments
    True that this is why a downgrade is in fact a big deal. Here's another part of the story that's not as obvious though. Many more funds and investment vehicles don't require AAA ratings on everything, but they require that as a whole the fund carries some average rating- perhaps AA for example. So the first things that might plummet in value are the lower-graded more speculative investments that funds would be forced to drop to keep the average up. This could be the real story when a downgrade in Govies happens - the bottom players in the market could be pushed out.
    "A witty saying proves nothing." Voltaire

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    Re: S&P tells White House it will downgrade U.S. rating

    Quote Originally Posted by Lord Tammerlain View Post
    The AAA rating they gave out during the 2000s were primarily due to conflicts of interests. They were being paid to help create the MBS's and have them achieve AAA rating. If they turned around and gave them less then a AAA rating they would have lost a huge amount of consulting business
    Indeed. I have no reason to believe they aren't as corrupt now as then.

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    Re: S&P tells White House it will downgrade U.S. rating

    Quote Originally Posted by MrVicchio View Post
    The solution is massive reductions in spending across the board. MASSIVE spending cuts.
    Ask Herbert Hoover how well that worked. Spending cuts are part of the right answer. Oh, and one other question: does "across the board" include the military? Oftentimes conservatives make defense uncuttable for reasons I don't understand.
    "A witty saying proves nothing." Voltaire

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