[CNBC] S&P contacts White House to notify about a downgrade coming

I'm not sure the relevance of any of this or what kind of rebuttal there would be. None of the things that have been happening the last few months are related to anything the banks did or have done.

I agree here. Historically, most of our crises are caused by unexpected events (9/11, Libya, etc) or by mistakes made over long periods of time (most of our financial crises). This last month has simply been crises borne out of stupidity. The debt debate being taken to the edge for partisan reasons was simply the choice of politicians - the agreement could just as easily have come together a month earlier and prevented all sorts of unnecessary panic.

And then the S&P thing is absolute stupidity. They knew exactly what the result of their announcement would be, and they could easily have waited until markets were settled a bit in a few weeks - instead of doing right in the midst of a Euro debt crisis. Or even better, they could have actually waited to see what the debt ceiling deal was - $1.5T in entitlement reforms is different from $1.5T in tax increases, which is different from $1.5T in one-time cuts - before making their determination. That would have been the rational thing to do. Instead, the S&P just wanted to make a political statement and knew they were going to create significant market turmoil, which hurts the economy and makes our debt more problematic.

This is all self-inflicted damage to the economy through the stupid choices of a handful of people.

 

The Social Security you pay today goes to pay for others social security - it's not for you. That's the reality. Fairness is not what this is about - it's about our country being able to survive fiscally and remain a power and a great place to make a home.

Just as we declared war on Al Qaeda, we have to declare war on this deficit. A war on excess, a war on debt or whatever - without tanking the economy - in fact, with growing it.

Ask yourself what is the only way to cap the deficit and not wreak the economy.

It's to cap entitlement programs, raise tax on the rich, and cut out things like oil/farm subsidies. And we need to make room for job growth initiatives or laws that reward companies that invest into U.S. hiring or infrastructure.

 

I'm for repeal of the Bush tax cuts and a roll back on the eligibility age for Medicare and Social Security.

Who do I vote for?

 

Kodos?

 

No argument regarding relevance to the topic at hand, I just recall that in the past you have defended the reforms, whereas robbie has called them out as ineffective and a virtual "fed guarantee" for future bailouts.

We've fought over this before - I was simply curious if you would disagree with robbie as well (needless to say, I think robbie is far more informed on this topic than I am since this is intrinsic to his job) (Needless to say again, I still think I'm right and your defense is inefficient).

Apologies for the intentional tangent.

 

No problem - I'm not as pessimistic as he is on the reforms. But the reality is that a lot of them will take time - rules are still being written, code is still being finalized, banks are still deleveraging, etc. A lot of people are opposed to that, but I'd much rather have regulators taking their time and writing the rules properly rather than clueless Congresspeople doing stupid things. But if there's a crisis tomorrow, we've still got a problem.

Over the long haul, I think Dodd-Frank helps a lot. That said, every financial crisis has a different specific cause, so it's hard to predict how anything would play out. They all seem to stem from leverage of some sort or another though, so the increase capital requirements between Dodd-Frank and BASEL should help there.

I know Dodd-Frank was supposed to reform credit rating agencies to some extent, but the Fed is still working on the rules. I wonder if there would have been any impact from that on the latest S&P decision (I have no idea).

 

http://www.thedailyshow.com/watch/thu-july-28-2011/dodd-frank-update

 

Lobbyists are the bane of our country, until they get those clowns under control we will continue to slide into oblivion.

Hell, just make them disclose meetings etc...bring em out in the open.

DD

 

I feel like I am serving witness to the end of American dominance.

This is how things crumble - old men squabbling like idiots unable to work together. Perhaps this weeks events will be historically remarkable not because of the hate for Obama or the Tea Party - but for it marking the real handoff to China and India as the worlds new economic superpowers.

 

China and India are only economic super powers because the US exists. If the US were to fall, they fall too.

 

A reminder of the deficit facts, courtesy the Washington Post. Look at the bleeping wars (authorized by both parties, mind you) and the tax cuts of the last 10 years. Staggering.



Again, if you're an investor, why do you want bonds from a company that is desperate to keep avoiding revenue?

 

This is an interesting angle that I hadn't really considered.


...and to B-Bob's graphic: Holy ****. The wealthy didn't need that money, but the country did.

Ideology really needs to take a back seat to practicality.

...like that will ever happen.

 

That is what I was hoping we got from Obama, while he is far better than Bush, he still needs to get those tax levels up to at least what they were under Reagan.

DD

 

Drudge summed it up pretty well: BARACKALYPSE NOW


What a pitiful ability to lead. Obama has taken the country to new depths.

 

HOORRRRAYYY FOR PLATITUDES AND CONCLUSORY STATEMENTS!!!!!

GO ROCKETS/TEXANS/ASTROS/REPUBLICANS/DEMOCRATS!!!!!!!

 

real GDP growth was .4% first quarter and 1.3% last quarter (which will probably be revised down). Given that you would raise taxes?

 

hey at least he didn't get 4,000 American kids murdered for a lie

 

oh yeah...well i'm rubber and you're glue...

 

Yep, on corporations and the rich, not on the middle class or lower income.

But I would roll back taxes to what they were under Ronald Reagan....

DD