U.S. likely to lose top rating: economists

Reuters via Fidelity.com ^ | July 26, 2011 | Pedro da Costa and Andy Bruce

[mlocher]

WASHINGTON/LONDON (Reuters) - The United States will lose its top-notch AAA credit rating from at least one major rating agency, according to a Reuters poll that also found wrangling over the debt ceiling has already damaged the economy.

A small majority of economists -- 30 out of 53 -- surveyed over the past two days said the United States will lose its AAA credit rating from one of the three big ratings agencies -- Standard & Poor's, Moody's or Fitch.

Respondents saw a 20 percent chance of a new recession over the next year, a prospect that some economists say has been compounded by the acrimonious political fight over what is normally a procedural legislative vote on the debt.

[mlocher]

Reuters does not quite pull the trigger and blame Republicans for the debt squabble. However, they are making a case that the Republicans are to be blamed, most likely because of the debt squabble, when the economic recovery fails to materialize. Stay tuned for more articles that build the case.

[mylife]

According to a Rooters Poll?

Oke Doke

[FlingWingFlyer]

One of the consequences of too much “hope and change” and “fundamental transformation”.

[EagleUSA]

Like all the radical left-wing hack rags, they will be blaming the Repubs for EVERYTHING that Obama causes and does.

The Repubs had better realize their existence as a major party is on the line with the REAL American people and they had better hold their line, and fight Obama’s anti-American tyranny.

[doc1019]

Thank you obama.

[packrat35]

Respondents saw a 20 percent chance of a new recession over the next year

Don't these people ever get tired of carrying the democrat's water? 20% chance my ass. We are already in a DEPRESSION and its not the fault of this debt ceiling.

[B4Ranch]

I think everybody is pissed that we’ll have to get out of Libya. With the interest rate going up we won’t be able to afford to buy any more bombs and rockets to fight in these countries that aren’t attacking us.

[bossmechanic]

“Even if this worst-case scenario is not borne out, a firm majority of respondents — 38 out of 54 — said the uncertainty brought about by the political acrimony over the debt has already hurt economic growth.”

WTF?
Manufacturers are still makin’ stuff like usual.
Consumers are still buyin’ stuff like usual.
Obumo already wasted $4Tril, bailed out unproductive unions, forced Obumocare down our throats, totally screwed foreign relations LONG before the so-called debt crisis made news.
How do these economists figure standard congressional debate has hurt economic growth?
That’s horsepucky.

[hinckley buzzard]

Last time I checked, ratings services were not listed as a separate branch of gubbermint. Therefore they are to be veiewed most accurately as a special interest, with "skin in the game," as their hero says. The ratings agencies were complicit in the housing collapse, colluding with banks to enable the fraudulent kiting of securitized junk mortgages. They gave this garbage a AAA rating. 'Nuff said.

[hinckley buzzard]

Last time I checked, ratings services were not listed as a separate branch of gubbermint. Therefore they are to be veiewed most accurately as a special interest, with "skin in the game," as their hero says. The ratings agencies were complicit in the housing collapse, colluding with banks to enable the fraudulent kiting of securitized junk mortgages. They gave this garbage a AAA rating. 'Nuff said.

[JPJones]

Why do I think that this downgrading has been in the works for a long time, and that washington knew. And why do I think that this ‘debt ceiling’ crap is just a way for obama and dems to affix blame on repubicans?

[PieterCasparzen]

Obumo already wasted $4Tril, bailed out unproductive unions, forced Obumocare down our throats, totally screwed foreign relations LONG before the so-called debt crisis made news.
How do these economists figure standard congressional debate has hurt economic growth? That’s horsepucky.

You bring out an important point. The U.S. Federal government is merely reaching the point of it's self-imposted debt limit. The big change in spending more than was taken in in revenue happened between 2008 and 2009. Consider the following high level overview:

Comparing all three: Revenue - Spending = Surplus/-Deficit

Year____Revenue____Spending___Deficit__%_Change_from_prior_deficit


2000____2,025.2____1,789.2____236.0____88.0%
2001____1,991.1____1,863.2____127.9____-45.8%
2002____1,853.1____2,011.2____-158.1__-223.6%
2003____1,782.3____2,160.1____-377.8__139.0%
2004____1,880.1____2,293.0____-412.9____9.3%
2005____2,153.6____2,472.2____-318.6____-22.8%
2006____2,406.9____2,655.4____-248.5____-22.0%
2007____2,568.0____2,728.9____-160.9____-35.3%
2008____2,524.0____2,982.5____-458.5____185.0%
2009____2,105.0____3,517.7____-1,412.7___208.1%
2010____2,162.7____3,456.2____-1,293.5___-8.4%
2011____2,173.7____3,818.8____-1,645.1___27.2%

You'll notice the deficit was in the hundreds of billions for all of those years up until 2009. In 2008 the government spent 458.5 billion more than it took in. In 2009 it spent $1.4 trillion more than it took in ! And that trend is actually continuing !

Well over $1 trillion deeper into debt - every year. Clearly those policies you speak of, rammed down the throats of the American people, are what caused bells to ring and red lights to flash in the mind of any reasonable person who was aware of the scope of the changes that were enacted at the end of the Bush administration and picking up speed dramatically under the current occupant of the White House.

That is what should have triggered a downgrade.

The Federal government turned into the equivalent of someone earning $200,000 per year, every year - but spending over $350,000 per year - every year ! How long would their bank continue to increase their credit line ?

[Cheerio]

Of course the GOP will take the blame. Imagine Obozo was requesting the debt ceiling be raised and Nancy and Harry were in charge - there would be no debate. Dictators don't like to be challenged - that is what Nov 2010 was all about. It is a given that the GOP will take the blame - grow a pair, and do the job we sent you there to do. As a reminded that was to put a stop to the RAT party madness.

[AwesomePossum]

"a prospect that some economists say has been compounded by the acrimonious political fight over what is normally a procedural legislative vote on the debt."

Guess Reuters wasn't around in 2006...............

8:}