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Thread: Moody's offers different view on debt limit

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    Moody's offers different view on debt limit

    Live updates: The shutdown

    President Obama has said that, unless Congress acts to raise the $16.7 trillion limit by next Thursday, the nation will be at risk of default.
    Not so, Moody’s says in the memo dated Oct. 7.

    ” We believe the government would continue to pay interest and principal on its debt even in the event that the debt limit is not raised, leaving its creditworthiness intact,” the memo says. “The debt limit restricts government expenditures to the amount of its incoming revenues; it does not prohibit the government from servicing its debt. There is no direct connection between the debt limit (actually the exhaustion of the Treasury’s extraordinary measures to raise funds) and a default.

    The memo offers a starkly different view of the consequences of congressional inaction on the debt limit than is held by the White House, many policymakers and other financial analysts. During a press conference at the White House Tuesday, Obama said missing the Oct. 17 deadline would invite “economic chaos.”

    The Moody’s memo goes on to argue that the situation is actually much less serious than in 2011, when the nation last faced a pitched battle over the debt limit.
    Just like the empty threat to discontinue paying social security, it looks like Obama's default scare tactics are bogus, too.

    And this is the WaPo reporting this, of all sources, which is perhaps the real story here.

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    Re: Moody's offers different view on debt limit

    The Feds are still raking in tax dollars by the boatload. They got enough money for awhile.
    "“If we don’t deepen our ports all along the Gulf — places like Charleston, South Carolina; or Savannah, Georgia; or Jacksonville, Florida…” -Obama

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    Re: Moody's offers different view on debt limit

    Exhibit A in why the tea party will drive the US into default and cause the second GOP economic meltdown in 5 years.

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    Re: Moody's offers different view on debt limit

    Quote Originally Posted by Erod View Post
    Live updates: The shutdown



    Just like the empty threat to discontinue paying social security, it looks like Obama's default scare tactics are bogus, too.

    And this is the WaPo reporting this, of all sources, which is perhaps the real story here.
    Dude. The US govt can continue to pay the interest that it already got, sure, but it won't be able to pay the money the govt owns to either public services or private companies that took on a contract for the govt. Thus, a lot of businesses will lose a lot of money they more deserve due to the fact that they honored their contract.

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    Re: Moody's offers different view on debt limit

    Quote Originally Posted by head of joaquin View Post
    Exhibit A in why the tea party will drive the US into default and cause the second GOP economic meltdown in 5 years.
    Like the Fed and the Treasury haven't been printing money anyway for four years. Under Obamas guidance.
    "“If we don’t deepen our ports all along the Gulf — places like Charleston, South Carolina; or Savannah, Georgia; or Jacksonville, Florida…” -Obama

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    Re: Moody's offers different view on debt limit

    Quote Originally Posted by Rainman05 View Post
    Dude. The US govt can continue to pay the interest that it already got, sure, but it won't be able to pay the money the govt owns to either public services or private companies that took on a contract for the govt. Thus, a lot of businesses will lose a lot of money they more deserve due to the fact that they honored their contract.
    Here's another way to look at things -

    The majority of the public debt is held by the people of the USA. If the government fails to pay that debt then we get to foreclose.

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    Re: Moody's offers different view on debt limit

    Quote Originally Posted by Lutherf View Post
    Here's another way to look at things -

    The majority of the public debt is held by the people of the USA. If the government fails to pay that debt then we get to foreclose.
    By the people you mean... the federal reserve? because that's true, they are the largest debt owners of US debt but it still means that businesses that completed a contract with the govt and have to receive payment will not get it... and also the same about public services.

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    Re: Moody's offers different view on debt limit

    Janet Yellen supports deregulation so the "doves" in her own Democratic party are uneasy.
    Janet Yellen is a woman so those in the Republican party are uneasy.

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    Re: Moody's offers different view on debt limit

    Quote Originally Posted by Rainman05 View Post
    By the people you mean... the federal reserve? because that's true, they are the largest debt owners of US debt but it still means that businesses that completed a contract with the govt and have to receive payment will not get it... and also the same about public services.
    Baloney, pure rubbish, Sir. Moody's is correct and as I've been saying to anyone that has an ounce of grey matter; the USA will NOT, and I repeat for the umpteenth time, will NOT default. All it means is that the USA cannot borrow anymore money. It can pay it's debts with interest, and all that needs to be done is to prioritize how that money gets spent, period. Think of it like a budget. This is how much we make, this is how much we owe each month, so honey, looks like no cable tv, and cell phones this month. No eating out at Denny's, or McDonalds, and certainly not getting that massage at the spa. If we cut back, we'll be ok..

    Obama, and anyone in the world that believes his lie about default is a moron!


    Tim-
    “When buying and selling are controlled by legislation, the first things to be bought and sold are legislators.” - P. J. O’Rourke
    “Socialism is great until you run out of someone elses money” Margaret Thatcher

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    Re: Moody's offers different view on debt limit

    Quote Originally Posted by Rainman05 View Post
    Dude. The US govt can continue to pay the interest that it already got, sure, but it won't be able to pay the money the govt owns to either public services or private companies that took on a contract for the govt. Thus, a lot of businesses will lose a lot of money they more deserve due to the fact that they honored their contract.
    So the govt underestimates how much money it needs every year by 40% and has to borrow money at the end of the year to pay for it, even after a huge tax hike?
    "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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