EPTNOW they take a stand and say the US government loans, still the safest in the world regardless of our current debt talks, are slightly riskier? What a joke.
S&P Downgrades US Credit - Page 7
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Docta Spaceman
United States74 Posts
NOW they take a stand and say the US government loans, still the safest in the world regardless of our current debt talks, are slightly riskier? What a joke. | ||
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DeltaSigmaL
United States205 Posts
On August 06 2011 11:00 DeepElemBlues wrote: UK has a 0% growth rate because your austerity policies are a joke :D If they were serious about fixing their government's spending problems and the country's economic malaise they'd make real reform to the NHS and the general governmental regulatory structure. Instead the UK has tried to have it both ways which has failed spectacularly, as attempts to show Keynesian works through moderate or large doses of it have failed around the globe spectacularly these last few years. What has no basis in fact is the idea that government spending stimulates an economy after government debt reaches a certain point. The past few years should have readily disabused even the most foolish of this notion, but we still have people like you who think you can credit card your way out of anything. Academics who study this stuff don't know much, judging from their abysmal failures the past few years. Here's an idea: when you're trying to be condescending about intellect, it's better when there are no results to be found. Then you can just pontificate your ass off all day. We tried the way "academics who study this stuff" said, it didn't work. Guess they weren't so smart as you thought. http://en.wikipedia.org/wiki/Keynesian_economics Yes, spending during recession does work. It's not spending that created the great deppresion, and it's spending that gets us out if it. The problem is that the theory involves two steps. One: deficite spend during bad times. Two: increase tax during good times. Sadly no politician ever wants to propose a tax increase so it never happens and we never get rid of debt... Edit: and I don't like your anti-intellectual sentiment. It is both baseless and dangerous. If we don't take advice from people who actually spent years studying this stuff, taking examples from history and applying it, who do we listen to? Do we make glen beck our glorious leader? We should listen to some catchy quote from the learned sarah palin? | ||
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FoeHamr
United States489 Posts
On August 06 2011 10:56 arbitrageur wrote: Can you supply references for this or did you just hear it on Fox news or something? Well isn't it basic logic that rich people own big business's that hire people. So if you tax them more, they are forced to cut back and stop hiring people or lay off workers. So if you follow this basic logic, yes, you are in fact hurting the working class. | ||
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Alou
United States3748 Posts
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FarmI3oy
United States255 Posts
On August 06 2011 11:06 FoeHamr wrote: Well isn't it basic logic that rich people own big business's that hire people. So if you tax them more, they are forced to cut back and stop hiring people or lay off workers. So if you follow this basic logic, yes, you are in fact hurting the working class. Oh look someone has a brain  | ||
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Cassel_Castle
United States820 Posts
On August 06 2011 11:06 FoeHamr wrote: Well isn't it basic logic that rich people own big business's that hire people. So if you tax them more, they are forced to cut back and stop hiring people or lay off workers. So if you follow this basic logic, yes, you are in fact hurting the working class. Businesses aren't charities, it's not like you can donate to them and they'll save an American worker's job. | ||
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acker
United States2958 Posts
On August 06 2011 11:07 Alou wrote: Thanks Congress. Really hope the next discussions get some tax increases and reforms. God help the House Republicans if they criticize the expiration of the Bush tax cuts in December after this fiasco. | ||
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arbitrageur
Australia1202 Posts
On August 06 2011 11:06 FoeHamr wrote: Well isn't it basic logic that rich people own big business's that hire people. So if you tax them more, they are forced to cut back and stop hiring people or lay off workers. So if you follow this basic logic, yes, you are in fact hurting the working class. You haven't convinced me until you provide evidence. If you believe what you believe on the back of what you've just said, I feel you need to learn some skepticism. | ||
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Alou
United States3748 Posts
On August 06 2011 11:06 FoeHamr wrote: Well isn't it basic logic that rich people own big business's that hire people. So if you tax them more, they are forced to cut back and stop hiring people or lay off workers. So if you follow this basic logic, yes, you are in fact hurting the working class. They're already not hiring people. They're just sitting on their cash. Or if they are hiring, it's workers from cheaper labor markets. | ||
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Yttrasil
Sweden651 Posts
On August 06 2011 11:04 Docta Spaceman wrote: What's ironic here is that S&P along with Moody's played a large role in the financial crisis, as they carelessly rated subprime mortgage packages and risky CDOs AAA. They based their ratings on the average credit score of each loan in a CDO- as long as the average was above a certain number, the package would be rated AAA, even though it could be half full of terrible mortgages almost guaranteed to default. NOW they take a stand and say the US government loans, still the safest in the world regardless of our current debt talks, are slightly riskier? What a joke. This is not true actually, it was a US government agency that created these ratings for the subprimes if I remember correctly, don't remember the name for it though, although independent from the government so to say. The problem was that they earned more money the better ratings they gave thus giving good ratings to bad debt. Anyhow, recommend you to look into it it's very interesting and the lecture I had on it with a very accomplished economist was eye opening to me as to the rest of the class who just had read the news and other sources. | ||
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Korlinni
125 Posts
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acker
United States2958 Posts
On August 06 2011 11:09 Yttrasil wrote: This is not true actually, it was a US government agency that created these ratings for the subprimes if I remember correctly, don't remember the name for it though, although independent from the government so to say. The problem was that they earned more money the better ratings they gave thus giving good ratings to bad debt. Anyhow, recommend you to look into it it's very interesting and the lecture I had on it with a very accomplished economist was eye opening to me as to the rest of the class who just had read the news and other sources. S&P and Moody rated junk CDOs AAA. For starters. | ||
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jdseemoreglass
United States3773 Posts
More and more I am starting to realize that the problem in many nations is actually their flawed representative/democratic forms of government. The average individual is simply not educated nor intelligent enough to run a country, nor to elect representatives that are capable of running a country. Every election is the pseudo-intellectuals' version of an "American Idol" style popularity contest, while the brain-dead herd animals will vote left/right even if it was a turd sandwich running for their party. Don't you all realize it doesn't matter wtf each party did in the whole ridiculous "debt deal"? Don't you realize that we simply cannot cut enough, nor raise taxes enough, to truly get ourselves out of the hole we are in? We need a fiscal adjustment equal to approximately 15% of GDP. That is quite simply NOT GOING TO HAPPEN, no matter who is in office or who "compromises" with the other side. The fact that we can go through this whole debt debate and end up cutting just enough to ensure that we still increase our budget next year is enough to reveal what a whole charade this political system is. We never "cut" anything, we simply reduced the rate of increase in our debt. This is just a waste of time. People don't look at the actual numbers involved in this situation. Everyone is still stuck in "us vs. them" fantasy land. | ||
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Fleebenworth
463 Posts
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arbitrageur
Australia1202 Posts
On August 06 2011 11:06 DeltaSigmaL wrote: Edit: and I don't like your anti-intellectual sentiment. It is both baseless and dangerous. If we don't take advice from people who actually spent years studying this stuff, taking examples from history and applying it, who do we listen to? Do we make glen beck our glorious leader? We should listen to some catchy quote from the learned sarah palin? There isn't consensus amongst publishing economists. This argument applies to anthropogenic climate change, not fiscal economics. | ||
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Cassel_Castle
United States820 Posts
On August 06 2011 11:11 Fleebenworth wrote: It's a sign of the utterly stupid foundations of the system that these firms, who rated junk bonds as 'AAA' based on what turned out to be bribes, are still looked at as influential and serious people. They should be in jail. I don't like putting non-violent criminals in jail any more than I like the death penalty, but that's a discussion for another thread. If they're fined and known to be corrupt then they're both punished and not a danger to anyone. | ||
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TofuFox
374 Posts
On August 06 2011 10:45 Saryph wrote: The Fed announced it won't change the risk weights. On another note, S&P put out a statement saying the reason for the downgrade was because BOTH sides are fighting too much, and that the government wasn't properly look at cutting spending AND raising taxes. Not one, but both. Yet even after that release, all you see here is one person after another blaming only the republicans, or only the democrats. Amazing. Full S&P Statement Incidentally, it does contain The outlook on the long-term rating is negative. We could lower the long-term rating to 'AA' within the next two years if we see that less reduction in spending than agreed to, higher interest rates, or new fiscal pressures during the period result in a higher general government debt trajectory than we currently assume in our base case. ..... Our revised upside scenario--which, other things being equal, we view as consistent with the outlook on the 'AA+' long-term rating being revised to stable--retains these same macroeconomic assumptions. In addition, it incorporates $950 billion of new revenues on the assumption that the 2001 and 2003 tax cuts for high earners lapse from 2013 onwards, as the Administration is advocating. Which party is more likely to do that? That said, that would not return the situation to AAA, it'd change it to AA+ (negative outlook) to AA+ (stable outlook). Longer term: ... as we see it, the resulting agreement fell well short of the comprehensive fiscal consolidation program that some proponents had envisaged until quite recently. Republicans and Democrats have only been able to agree to relatively modest savings on discretionary spending while delegating to the Select Committee decisions on more comprehensive measures. It appears that for now, new revenues have dropped down on the menu of policy options. In addition, the plan envisions only minor policy changes on Medicare and little change in other entitlements, the containment of which we and most other independent observers regard as key to long-term fiscal sustainability. Again, the entitlements are the main issue. Both parties have attacked each other over entitlement cuts freely; the Democrats have shown willingness to pass significant cuts (the Medicare cuts in the Affordable Care Act) but their record on larger reforms is spotty and much of the cuts were (relatively) low hanging fruit. Republicans have voted for changes in the Ryan plan, but said plan had no chance of actually passing (which makes a hero out of everyone) and contained massive tax cuts that rendered it useless in terms of becoming solvent (See the tax policy center ). | ||
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Yttrasil
Sweden651 Posts
On August 06 2011 11:11 acker wrote: S&P and Moody rated junk CDOs AAA. For starters. Well they owned and did parts of it, again I don't remember but the problem was not with S&P and Moody but an agency created to rate these bundles of subprime loans etc. Again don't have the papers on me as they are at my parents place but if you can google abit I'm sure you'll find the info as what you are saying is not the whole truth and not the origin of the core problem. | ||
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Sabu113
United States11095 Posts
On August 06 2011 11:06 FoeHamr wrote: Well isn't it basic logic that rich people own big business's that hire people. So if you tax them more, they are forced to cut back and stop hiring people or lay off workers. So if you follow this basic logic, yes, you are in fact hurting the working class. Unfortunately things are as simple as "basic logic." Corporations have been sitting on a ton of cash through this recession and awhile back were mainly using that money for mergers and acquisitions. The lack of demand is leading to a reluctance to invest in more supply. What matters in regards to taxcuts is giving money to people who are "liquidity constrained." These are people who if they were consumption smoothing would prefer the ability to spend at their normalized income for this period of time (normalized over income they earn during their life). I do not understand how you would operationalize an argument that a higher marginal income tax would result in businesses actually firing workers. The payroll tax may temporarily discourage acquiring new workers yes and there are mixed arguments about capital gains which I dont feel comfortable talking about with any confidence at the moment. Edit: As to CDOs, anything not subprime was backed by Freddie/fannie so it was pretty safe to rate well and securitize? | ||
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DeltaSigmaL
United States205 Posts
On August 06 2011 11:12 arbitrageur wrote: There isn't consensus amongst publishing economists. This argument applies to anthropogenic climate change, not fiscal economics. Economists said spend during 2008-9 and spend we did. It save us from certain depression. If you doubt the depression looke at the climate back then. Lehman, AIG were failing, credit was freezing. Trust in banks was falling, sound familar? Now that things are more or less stable, extreme right wing has the audacity to claim we didn't need that spending. They call it reckless. What they are doing is extremely reckless. (I don't have anything against the right, infact I think they are better at getting things done than the left, it's just the extreme that I do not like.) | ||
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