Shares on Wall Street opened sharply lower and Treasury prices fell on Monday after the Standard & Poor’s rating firm lowered the outlook for the United States to negative, saying that there was a risk that lawmakers might not reach agreement on how to address the country’s fiscal issues.
“More than two years after the beginning of the recent crisis, U.S. policymakers have still not agreed on how to reverse recent fiscal deterioration or address longer-term fiscal pressures,” a credit analyst with Standard & Poor’s, Nikola G. Swann, said. At the same time, the firm affirmed the government’s AAA rating.
“More than two years after the beginning of the recent crisis, U.S. policymakers have still not agreed on how to reverse recent fiscal deterioration or address longer-term fiscal pressures,â€
“The idea that the U.S. public finances are on an unsustainable trajectory is hardly new news,†economists from Capital Economics said in a research note. “Indeed, we warned that the U.S. might be downgraded, or at least put on negative watch, as far back as nearly two years ago.â€
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What an indictment of our elected national political leadership?
Ideological goals appear to be more important to that leadership than having the fiscal means available to achieve those goals.
Called my congressman again. Not a word from his aide. Just silence as I described the fall of the US, just like Argentina, 40 cents of every dollar spent by the federal govt is borrowed. They are out of control.
crickets…… silence……”Yes, I’ll give the congressman your comments.”
They are the same comments I called with 2 years ago. Tried to vote him out. Unions keep him in. Middle class will be gone in a few years. Only the George Soros, the John – I park my boat in tax-free Rhode Island – Kerrys, the Richard Trumpkas, the BHOs, the Immelts and other wealthy will be left, then the rest of us. We will be born into a caste and will never leave that caste because the govt has sewn up all the opportunities to fail (can’t happen) for those in power.
Really heartbreaking. My country will be gone, nothing left for my kids, my grandkids will be slaves to the $14trillion debt. I hate this govt, I love my country and I love my countryman.
Wait…this is the same S&P that a few years ago slapped rock-solid AAA ratings on dicey financial instruments that led to the mortgage crisis, right?
And the same S&P that was later caught allowing its raters to set the rating fee–that is, essentially selling the AAA rating for a price?
The same S&P that gave Enron a high rating days before it went under?
Not sure S&P is in a position to make this call–unless one believes they’ve cleaned up their act….
Reply to Don Ennis (#3.).
Regardless of S&P’s credibility or lack of it, the citation,
“More than two years after the beginning of the recent crisis, U.S. policymakers have still not agreed on how to reverse recent fiscal deterioration or address longer-term fiscal pressures,â€
is still an indictment of our political leadership.
The lack of action by Washington can only be one of two things, either it is further evidence (was any needed?) that Washington is broken, or that our leaders including President, Senate, and at least some of Congress are guilty of treason.
The credit rating agencies are a joke. They should have stripped the US of its AAA rating halfway into George Bush’s presidency. Any day now I expect them to put Confederate bonds on a negative credit watch.
Ad Orientum (#6.) said,
“They should have stripped the US of its AAA rating halfway into George Bush’s presidency.”
And I ask, “Why did you say what you said Ad Orientum?”
Because G W Bush cut taxes (mostly for the very wealthy) while launching a war of choice against another country when were already engaged in a war not of our choice. Then he passed a bill creating a massive new Medicaid entitlement that was projected to blow giant holes in the budget without paying for one cent of it. He squandered a budget surplus and cooked the Federal books in ways that would have made Enron blush (like keeping all of the expenses related to his military adventurism “off budget”).
Obama is just following down the path that Bush and “deficits don’t matter” Cheney blazed.