Posted on 08/09/2011 9:29:38 PM PDT by lbryce
Seriously. All you people on left and right, suspend your disbelief for one minute. Seriously.
What if Barack Obama was right and S&P just got it wrong.
Here’s what I’m hearing and it gives credence to this theory.
S&P, I’m told, began telling some of its clients about the downgrade on Friday morning. That’s why the market was so screwed up on Friday.
By Friday afternoon, the Treasury Department told S&P it had made a $2 trillion math mistake.
But S&P had already told its clients about the downgrade. So it couldn’t walk it back now without a major loss of confidence in its credibility. Could you imagine that conversation? “Hey . . . um . . . Joe. Yeah, Charlie here from S&P. So . . .um . . . we made a $2 trillion math mistake in our downgrade analysis. . . . What’s that? You just lost $500 million in the market because of it? Oh . . . um . . . sorry Joe. Better luck next time.”
So it had to come up with a different reason.
It’s reason? Acrimony in Washington — in other words, nothing to do with the U.S.A.’s ability to pay its debts or financial issues, just typical Washington politics. And it couched its statement in such a way that the tea party movement could say, “see, see, we told you Washington needed more cuts,” and the left could say, “see, see, we told you we needed tax increases.”
Acrimony in Washington is nothing new. Despite a lot of rhetoric about compromise this past week, it is a feature, not a bug, of the American system of government. And major debt and growing deficits are nothing new. And they are bipartisan, pre-existing, long term, and long existing problems.
(Excerpt) Read more at redstate.com ...
That’s as irresponsible as S&P, and it also does not compute if S&P is the one that screwed up.
* By the way, to lend further credence to the idea that maybe the White House economic team is right and S&P screwed up, where did investor cash flee to during the market collapse of Friday and now, it seems, again today? Why U.S. Treasuries of course. ======================================================================================
Does put things (somewhat) in perspective (in reference to my previous post.)
FR:August 9, 2011-
Richard Koo: The Ratings Agencies May Destroy The Global Economy Once Again
http://www.freerepublic.com/focus/f-news/2761409/posts
...
They’ve been warning for months that it was coming if the US government didn’t do something about the deficit spending.
Mistake or not, we’ve been at the edge for some time now.
Given we create our own money to prop up the stock market, what is the basis for claiming the US wont be able to pay it’s debts, some of which is to the Federal Reserve? I am sure S+P doesnt have a clue.
In all seriousness, we know he is wrong.
I don’t believe anything that comes out of the mouth of zero. After all, everytime he moves his lips, he lies.
I’m just sayin.....
They said that it would require cuts of $4 trillion to maintain the credit rating. The $2 trillion “mistake” is the government’s: counting a promise to reduce the rate of increase sometime during someone elses term as real cuts.
A two trillion dollar accounting error? Yeah, ok..
*rolls eyes*
It’s the spending, stupid!
The reason I think this story is nonsense:
S&P is now downgrading muni’s.
I doubt they would do that without a better reason than there is a split of opinion in DC.
S&P Motives?
The owner of S&P is McGraw Hill.
Note this:
—
Pre-Marketing: S&P for sale?
http://www.businessbrokerjournal.com/blog/pre-marketing-sp-for-sale
“Big breakup? Activists put pressure on S&P owner McGraw Hill “
Broke clock right twice, maybe? Although I agree with you about the chronic lying.
Why is Axelrod blaming the tea party? Because that was the plan when this October surprise landed and the S&P downgraded US debt. Because if you shift us over just a bit, like 15 months, we're right before the November elections. And the last defense of this White House as ALWAYS been to blame someone else for their mess. It's Bush's fault, it's the Tea Party's fault, it's martians who did it...
I sure hope that Obama is making sure his people know the birthdays of every senior analyst at S&P and buying them really really nice birthday presents (like a DVD collection from Europe?) for this very generous gift. Because the downgrade’s not happening right before the November elections, it's happening well over a year before, and gosh, no where near when people are heading to the ballot boxes.
What a present the S&P gave Obama by spilling the beans a little early.
In All Seriousness, what if Erik Erikson bought a spin?
Pardon my naivete but wouldn’t divulging a not yet public rating change, and more importantly, trading on that knowledge be a violation of securities laws?
In other words, there is no 'two trillion dollars'. It's a projection, based off of rainbow-and-sunshine flavored unicorn flatulence from the White House. That money doesn't exist, and it's money that we have no reason to believe will exist. It's a lie. They can pout and whine and demand we believe them, but they can't produce any numbers to prove it.
It's fantasy math. It's like arguing with your bank that you're really a billionaire, but they lose your last deposit of 1 billion dollars and they're the ones being unfair for not changing their accounting practices. You can wave your crayon scribbled napkin and call it a deposit slip, but no one will believe you.
Ask yourself...do we deserve to be downgraded, given our current condition & no plan to fix it? Common sense is so uncommon these days that folks never stop to see what’s obviously right before their very eyes.
Sigh....it’s all part of the strong delusion.
I still can’t believe the stock market has done as well as it has. The only reason I can find is the excess liquidity pushed into the market by the Fed/Treasury. It surely can’t be business taking loans and spending money!
Despite the economic measurables pointing to stocks being a good buy the fact remains that the entire foundation of our nation and country is wobbling badly. All this rating agency did was point out the obvious.... nothing is changing. Bush (yes, he did) spent too much. Obama has spent twice as much as Bush. A good start would have been for Congress to push spending back to past numbers before the hyperspending by the government.
They could not do it. The debt crisis and deal proved it.
Well Obama is right about S&P, but in the wrong way.
The downgrade of US debt should have come much earlier, and been much more severe.
And further still, prescient rating services would have downgraded the US immediately after the Marxist was elected in November of 2008
Marvel Comics used to do this every month. My favorite was, “What if Uncle Ben didn’t die?”
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