Skip to comments.S&P Sounds Alarm On US, G20 Downgrades
Posted on 01/31/2012 11:36:49 AM PST by blam
S&P Sounds Alarm On US, G20 Downgrades
Antonia van de Velde, CNBC
January 31, 2012
Concerns over the size of United States debt reared their head once again as ratings agency Standard & Poors warned that health care costs for a number of highly-rated Group of 20 countries, including the U.S., could hurt growth prospects and harm their sovereign creditworthiness from the middle of this decade.
S&P downgraded the United States credit rating for the first time ever in August of last year.
"Governments' fiscal burdens will increase significantly over the coming decade, with the highest deterioration in public finances likely to occur in Europe and other advanced G-20 economies, such as Japan and the U.S.," S&P said in a statement on Tuesday.
Health care costs for a typical advanced economy will stand at 11.1 percent of gross domestic product by 2050, up from 6.3 percent of GDP in 2010, S&P said.
"Population aging will lead to profound changes in economic growth prospects for countries around the world as governments work to build budgets to face ever greater age-related spending needs," said Standard & Poor's credit analyst Marko Mrsnik in the statement.
The August downgrade of the United States rating was an embarrassment to the country, but fears that the move would hurt investors confidence in the country proved unfounded.
David Owen, Chief European Economist at Jefferies International believes the U.S. will face another downgrade, but that its impact will again be limited.
Is the U.S going to be downgraded again? We think so, he told CNBC on Tuesday. Our general perception is it wont have a material impact. It could even lead to more money flowing to the U.S in the way we saw following the initial downgrade.
S&P's first downgrade
(Excerpt) Read more at businessinsider.com ...
This video, in a very entertaining way, puts the country’s problems forward in a clear way that explains why we are all screwed.
The script is great and the acting top notch. How those guys kept straight faces is beyond me.
Ping for later
Sponsoring FReepers are contributing
$10 Each time a New Monthly Donor signs up!
Get more bang for your FR buck!
Click Here To Sign Up Now!
“Poor’s warned that health care costs for a number of highly-rated Group of 20 countries, including the U.S., could hurt growth prospects and harm their sovereign creditworthiness from the middle of this decade.
....And the plan is not just it, but to leverage it by ammendment, after ammendment, after ammendment, ....on and on.......