Posted on 08/02/2011 10:51:36 PM PDT by george76
Chinese credit-rating agency Dagong Global Credit Rating Co. again downgraded U.S. sovereign debt Wednesday and warned of further downgrades, the state-run Xinhua news agency reported....
Dagong cut U.S. Treasurys to A from A+, with a negative outlook, saying growth in U.S. debt is still outpacing revenue growth. The latest move followed a Dongang downgrade of U.S. debt from AA to A+ in November, citing the launch of the Federal Reserve's second round of quantitative easing.
"The agency said the approval to raise the debt ceiling indicated that there will not be any positive changes in factors that will influence the country's debt-paying ability in the long run,"
...
The news came the same day as a Xinhua editorial said the U.S. had failed to defuse its “debt bomb.”
(Excerpt) Read more at marketwatch.com ...
some of this stuff is hard to believe.
US 10 year bond, yield is 2,58 percent.
don’t believe me?
go here
http://www.bloomberg.com/apps/quote?ticker=USGG10YR:IND
Unfortunately, we don't know exactly what the Fed does with Quantitative Easing currency creation, they have been able to defeat Congress' demands for transparency.
Additionally I failed to note (poor math), the the Chinese sale of bonds likely went to the foreign nations that now hold more than China.
This means there is less chance that an accomplished QE currency creation has gone for US Treasury Bonds. The danger is that the Fed will do this in the future.
They don’t. They, of course, rank China bonds AAA.
Same old ****, different day.
Compared to the stock market which has returned over the last 11 years a total of .2 percent? That’s a princely sum.
Yeah, Obama’s going to have to dip into his stash to keep it above 10k. We’re going down folks!
Market peak in Oct of ‘07 still the high point, close to 4 years later. Only period that was longer was the recession from ‘00 to ‘06, where it took 6 years to fully recover.
Downgrading our credit rating isn’t a blind man’s move these days.
Perhaps China is wrong to rate their’s AAA. I still don’t see our credit rating to be good.
With the Obama/Geitner Comedy team in charge, this is a circus.
I appreciate your response though. I doubt you see us as a great bet today either. Raising the debt ceiling once again, this simply cannot go on. Today, tomorrow, ten years from now, we’re going to wind up in a world of hurt.
Market from 1965 to 1982 was essentially flat. So that’s the last time we had such a long period where the DOW didn’t climb.
DOW in 1965 was 910 and was 884 in 1982. So that’s 17 years. This downturn has already lasted 11, going on 12 years now.
Great depression was 1929 to 1954, so 25 years. :(
It’s my future that’s being put on the chopping block. Every dime that the Bamster pisses away in the next two years is a dime that has to be paid back.
Pretty soon, Obama’s going to keep throwing money to keep the DOW over 10k.
“Lord I hope they are decent people. Half of them are commies and a further 1/4 are nuts, but a further 1/4 are like us.”
Why shouldn’t they be?:-)
Both commies and nuts can be decent people. I suppose the 1/4 like you are mainly decent too. Although you haven’t always been in the past when in a power position. Sorry to say, but the US have been involved in quite a few questionable conflicts on the side of dictators instead of the majority of the people. Hope that is not the case any longer.
It would have been nice if we had made the cuts. We had to fight tooth and nail just to get what we got. It’s worth noting that Asia has problems of its own.
Well, well and well. The budget deal foisted on us by Onada, Reid, Pelosi, Boehner, McConnell and DeMint is so good even the Chicoms don’t like the smell of it.
By the way where are our treasonous threeseome—Boehner, McConnell and DeMint? Has anyone heard from any of them since the budget travesty passed? Hell, if I were them and proud of my accomplisment I’d be racing Chuckie Schummer to the microphone.
They aided and abetted the Marxists and they know it. Their constituents—who they deceived to get elected— ought to do whatever it takes to throw them out, make them resign or make it impossible for them to run for public office again.
The Fed will write the checks via QE3 or some shadow purchasing scheme and even higher inflation will follow.
I think Demint is too optimistic, we may not even have 10 yrs. left.
I agree. I’m not truly convinced they haven’t already done that either.
Didn’t he even say that once they ran outta money that the markets would collapse?
You do realize the Chinese quit adding US Treasuries (actually a net seller) over the past year. Meanwhile our trade deficit with them started increasing again over the same period.
Strong yuan lowers their production costs.
You gotta explain that one to me....
Rising currency = lower input costs. Strong yuan = cheaper steel, chemicals, fuel, energy, et c., from the Chinese perspective. The weak yuan issue is a red herring when it comes to our trade balance with them. Pretty strong evidence that our trade deficit actually increases as the dollar devalues relative to the yuan. Main reason being the differential effect on PPI.
On the flip side, our weak dollar policy is absolutely killing our manufacturing sector. In a monetary expansion, commodity inflation always hits before consumer inflation. What you get is supply shock and margin squeeze. Recipe for stagflation.
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