US credit rating downgraded

[leo8877]

So S&P downgraded the US credit rating to AA+.  So what's going to happen on Monday?  Total mayhem?  Stock market collapse?  Rioting and looting in the streets?

[gellar]

Market be fucked.

[CeeKay]

Rioting and looting in the streets?

dammit, stop going through my dayplanner.

[corruptrelic]

SHANGHAI — China, the largest foreign holder of United States debt, said Saturday that Washington needed to “cure its addiction to debts” and “live within its means,” just hours after the rating agency Standard & Poor’s downgraded America’s long-term debt.

"The U.S. government has to come to terms with the painful fact that the good old days when it could just borrow its way out of messes of its own making are finally gone," read the commentary. Beijing called on Washington to make substantial cuts to its "gigantic military expenditure" and its "bloated social welfare" programs.

http://www.nytimes.com/2011/08/07/business/global/china-a-big-creditor-says-us-has-only-itself-to-blame.html

[papasmurff]

both political parties got us to where we are today.  I was very disappointed in the republicans unwillingness to budge on tax issues and democrats refusal to address social welfare programs.  I was also very disappointed that part of the compromise increased the cost of getting a college education by removing subsidized graduate school loans... politicians yell about passing the debt on to the next generation, but that is exactly what they are doing.  Their unwillingness to act will force my generation to make the hard cuts they won't...

Oh and the Tax revenue issue.  The tax code needs to be revised and revenue needs to be increased on the wealthiest Americans and corporations.  Those who argue tax increases on this group will slow hiring are full of shit... I was really pissed that Obama fought so hard to do this and then this week came out with Tax credits for companies who are hiring military vets (not that there is anything wrong with hiring vets).   

[raydude]

Oh and the Tax revenue issue.  The tax code needs to be revised and revenue needs to be increased on the wealthiest Americans and corporations.  Those who argue tax increases on this group will slow hiring are full of shit... I was really pissed that Obama fought so hard to do this and then this week came out with Tax credits for companies who are hiring military vets (not that there is anything wrong with hiring vets).   

In my opinion this is Obama's way of putting a stimulus into the economy to create jobs. Given that the Republicans are against raising taxes, the only way to raise revenues now is to increase the number of jobs. Two ways to do that:

1. ask the private sector "pretty please, can the unemployed has jobs?"
2. give the private sector some incentives to hire (which of course costs money).

He's going for option 2. However, I doubt Republicans will buy into it, which means we're stuck with option 1 and we're fucked.

[Razgon]

Guys, please fix this fast... This has resulted in my having to wait 2-3 weeks for word on me getting a job or not!!

[CeeKay]

So, how low is it going to go?  Sub 10k?  9K? 8k?

Lower?

[papasmurff]

So, how low is it going to go?  Sub 10k?  9K? 8k?

Lower?

I think it will drop sub 10 then hang around 10500 until after the elections.... I wouldn't be surprised if it drops another 1500 points the next couple of weeks.  At this point total fear has sunk in on the markets and investors will continue to bail up to a certain point (usually around 9000 which would only be a 25% correction... at this point we are only at a 15% correction with all the negative news... look for retail to be weak... gold and precious metals are the safe bets... oil and commodities will plummet, but that won't really affect prices... inflation is bound to set in... unemployment will stay steady at 9.2%...  just my two cents (no i am not an investment person so don't take my ranting to actually mean anything)...

[Victoria Raverna]

SHANGHAI — China, the largest foreign holder of United States debt, said Saturday that Washington needed to “cure its addiction to debts” and “live within its means,” just hours after the rating agency Standard & Poor’s downgraded America’s long-term debt.

"The U.S. government has to come to terms with the painful fact that the good old days when it could just borrow its way out of messes of its own making are finally gone," read the commentary. Beijing called on Washington to make substantial cuts to its "gigantic military expenditure" and its "bloated social welfare" programs.

http://www.nytimes.com/2011/08/07/business/global/china-a-big-creditor-says-us-has-only-itself-to-blame.html

It is stupid to listen to China. They're not going to give good advice since they're a competitor.

Curing addiction to debts or live within its means is the thing that is going to kill US.

The solution is actually to borrow more.

Don't think of government debt as credit card debt but think of it as a business borrowing money to expand/invest.

Instead of trying to reduce debt, the government should transform from a non-profit organization into a profitable business organization. Borrow more money, invest those money. Buy or invest in profitable businesses around the world. Ignore idiots that call it socialism. It is pure capitalism, run the government like a business that give "government services" to citizens as corporate social policy but make profit from elsewhere. If successful this will eventually lower the taxes since the government don't need to collect taxes to cover the expenses if they make enough profit.