oldsaw wrote: The President is scheduled to deliver an address this afternoon. It's doubtful that he'll heed the advice offered by an accomplished entrepeneur.
Because being an entrepreneur somehow makes you a great leader?
Also, I tend to think there is a vast difference between running a soap company and being leader of the free world. Call me crazy! 
I can't see the vid, so I don't know if I am saying the same thing. But I can't help but think that the recent uproar about the debt and trying to fix it is what has caused this. That is to say, if we just sailed the course and did the standard "here's another budget, here's another dept ceiling increase" none of this downgrading would have happened.
I am NOT saying ignoring the debt is (or would have been) a good idea, I am just noting that the "market" is an absurd emotional beast that has little to do with reality sometimes.
You know what's crazy?
Stocks are down because S&P, the same people who were so wrong about all those mortgage funds, downgraded our bonds. So what does everyone do? Jump out of stock in private industry and invest in- you guessed it- the very bonds that S&P downgraded.
Am I the only one who got tired of seeing politicians saying on national television that the US has never defaulted on debt before?
5 times, big defaults at least: 1779,1782, 1862, 1934, 1979*
Shouldn't elected officials who get face time know E36 M3 like this before mouthing off in public?
*This one was, apparently, an accidental default.
Xceler8x wrote:oldsaw wrote: The President is scheduled to deliver an address this afternoon. It's doubtful that he'll heed the advice offered by an accomplished entrepeneur.Because being an entrepreneur somehow makes you a great leader? Also, I tend to think there is a vast difference between running a soap company and being leader of the free world. Call me crazy!
A successful CEO has the reponsibility to correctly identify problems and put the right people in place to solve those problems - even when the solutions are painful.
We've had way too many Presidents (both D's and R's) who cannot/will not understand the concept. Our current CEO is just the latest example.
A US President may be the "leader of the free world", but the first responsibility is to THIS country.
A CEO doesn't have to convience Congress.
Unless they do something bad.
fast_eddie_72 wrote: A CEO doesn't have to convience Congress.
Board members: practically a Congress.
In reply to fast_eddie_72:
The chief Executive officer has to convince the stockholders (citizens) and the board of directors (Congress). Under his/her direction, the citizens and Congress will respond to the cold, hard facts.
Seems like the citizens have a better perspective and understanding of those facts than anyone in DC.
Osterkraut wrote:fast_eddie_72 wrote: A CEO doesn't have to convience Congress.Board members: practically a Congress.
Your average board member probably has a better credit rating and is less likely to have a bankruptcy in his or her past than your average congressman.
Snowdoggie wrote:Osterkraut wrote:Your average board member probably has a better credit rating and is less likely to have a bankruptcy in his or her past than your average congressman.fast_eddie_72 wrote: A CEO doesn't have to convience Congress.Board members: practically a Congress.
Not that I put a lot of value into credit ratings, but yes, you're right. Though if we're talking about self-made board members, there's probably more than a few bankruptcies.
[ wishing the dow would stop plummeting]
I have absolute confidence that our government is doing the right thing. That S & P has some nerve! Trying to spoil the fun by bringing bad news to the party. Let's shoot the messenger!
Good article here:
http://money.cnn.com/2011/08/08/news/economy/sp_rating_maya_macguineas/index.htm
My thoughts are as follows:
interesting comparison to "debt growth vs GDP growth". Essentially they are saying that 40-60% debt/GDP ratio is OK, but we've not only surpassed it but the growth of debt/GDP is too large. I can buy that, but I'd personally like to see much lower debt numbers - 10-20% maybe.
The debt ceiling talks ARE NOT THE TIME for debating the budget. If you are new to congress, get a bill passed that says that we'll raise the limit and then pass a new budget before X month. If you signed the budget and didn't sign the debt ceiling bill, then you are doing it for the cameras.
Close all loopholes, now. Reduce overall rates for business and people, but close the loopholes. Revenue would be higher and it would be easier for regular folk to make and keep money. No more tax breaks for hardly anything, but keep the real tax rate low. I'd even say flat, but I know I'll get scoffed at.
Now I am just wondering when to buy stocks.
i'm gonna buy a bunch of exxon-mobil (XOM) when it hits $65.
Well, for once I moved a hunk of money the right way at the right time. Question now is, do I get the rest out, or do I jump back in with both feet. Can't say I'm feeling good about jumping back in right now. I think I'll sit pat for a bit.
tuna55 wrote: The debt ceiling talks ARE NOT THE TIME for debating the budget. If you are new to congress, get a bill passed that says that we'll raise the limit and then pass a new budget before X month. If you signed the budget and didn't sign the debt ceiling bill, then you are doing it for the cameras.
The dissenting view is that introducing budgetary and spending topics was taking advantage of an opportunity, one that sets a serious tone for the upcoming debate(s). A downgrade was imminent even if the ceiling had been raised with no other considerations attached.
Yep, it was and is messy, but now it is the focus of the people and the politicians who were hired to address it. The people won't forget and any pol who does will likely be looking for a new job - as soon as November 2012.
oldsaw wrote: A downgrade was imminent even if the ceiling had been raised with no other considerations attached.
According to who? Not S&P. They said as much.
fast_eddie_72 wrote:oldsaw wrote: A downgrade was imminent even if the ceiling had been raised with no other considerations attached.According to who? Not S&P. They said as much.
I agree with Eddie here. I also don't really care too much about the AAA rating, we probably don't deserve it anyway, but I doubt the S&P would have downgraded us if the debt ceiling had just been raised like normal.
tuna55 wrote:fast_eddie_72 wrote:I agree with Eddie here. I also don't really care too much about the AAA rating, we probably don't deserve it anyway, but I doubt the S&P would have downgraded us if the debt ceiling had just been raised like normal.oldsaw wrote: A downgrade was imminent even if the ceiling had been raised with no other considerations attached.According to who? Not S&P. They said as much.
S&P says their downgrade was the result of the bickering and failure of the political process.
Maybe I'm thinking too far out of the box, but it's hard to see this would have been avoided when 'real' budget negotiations are on the table. Now, the consequences are obvious to all.............
tuna55 wrote:fast_eddie_72 wrote:I agree with Eddie here. I also don't really care too much about the AAA rating, we probably don't deserve it anyway, but I doubt the S&P would have downgraded us if the debt ceiling had just been raised like normal.oldsaw wrote: A downgrade was imminent even if the ceiling had been raised with no other considerations attached.According to who? Not S&P. They said as much.
They said that they were going to down grade us if we maintained our unsustainable path. A simple raise of the debt ceiling would have been maintenance of that path, and rightly would have also earned a downgrade.
I'm not sure ANYTHING could have avoided a downgrade. I mean, we've been doing everything we can for the last 10/30/60 years to earn a bad credit rating. I'd say that the AAA we had was the improper one. AA+ seems generous given how deep we are in doodoo.
DILYSI Dave wrote: I'm not sure ANYTHING could have avoided a downgrade. I mean, we've been doing everything we can for the last 10/30/60 years to earn a bad credit rating. I'd say that the AAA we had was the improper one. AA+ seems generous given how deep we are in doodoo.
Well, I agree we have issues and it's time to get them in order. What I am a little confused by are these comments that we deserved it and they're being generous. I just don't see the numbers to back that up. If you look at our debt to GDP ratio, it's high, but not so crazy high that it calls for a downgrade. It certainly is not so high that they're being generous at AA+.
There is practically zero chance the U.S. will default on our debt. There is simply nothing happening that would lead to that except for the political gymnastics we've seen in the last few weeks. For evidence, look no further than market performance today. People moved in mass to the very bonds S&P downgraded. Why? They're the absolute safest investments available on Earth. Period. If U.S. bonds aren't AAA, nothing is.
I think people are saying "we had it coming" and "it should be lower" based on the fact that we have a real debt issue, not on any real analysis of how serious that issue is or how the credit rating is actually assessed. We need to address debt so we can have a thriving and robust economy, not because we can't pay the debt we have.
Remember when they were talking about not raising the debt ceiling? Lots of people were saying we wouldn't default because the money coming in covers the debt. And there was even some left over for some entitlement spending and military spending. And that at fairly low tax levels. What does that mean? It means we're not in a 100% plus debt to GDP ratio. We're not even at 90% as S&P tried to claim at first, before a huge accounting error was found in their report. It's high, but not high enough to risk our credit worthiness.
I just lost 15% of my retirement savings between Friday and today as a result of the drop in the market. Needless to say, I am an unhappy camper as I retire on Septmeber 10. I will be actively campaigning to make sure those idiots in office now do not get re-elected.
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