Skip to comments.Chinese agency downgrades US credit rating
Posted on 10/17/2013 6:38:41 AM PDT by upchuck
A Chinese ratings agency downgraded its US sovereign credit rating Thursday despite Washington's resolution of the debt ceiling deadlock, warning that fundamentals for a potential default remained "unchanged".
Dagong lowered its ratings for US local and foreign currency credit from A to A-, maintaining a negative outlook, the agency said in a statement.
The announcement came after the US Congress passed and President Barack Obama signed a bill that extends the nation's borrowing authority and ends a two-week government shutdown.
"The fundamental situation that the debt growth rate significantly outpaces that of fiscal income and gross domestic product remains unchanged," Dagong said in the statement, adding Washington's solvency was vulnerable as old debts were still repaid through raising new debts.
"Hence the government is still approaching the verge of default crisis, a situation that cannot be substantially alleviated in the foreseeable future," it said.
(Excerpt) Read more at france24.com ...
A perfect summation of the problem. Wish I could get away with that.
Kick the Can Congress...
Cash advance a different credit card each month with a higher amount? LOL !!!
The credit rating drops are just starting. Someone is going to one up this Chinese company and give us a B+.
The Baghdad Bob MSM will blame it on the recent brinkmansship when its actually only about the never ending debt increases.
It’s easier if you own a printing press.
Bring back jobs to America.
Go into any Walmart, K-mart any large store in America.
Everything is made in China. Bring American jobs home.
‘Tis interesting indeed to see that communists in both Russia and China appear to have far more comprehension of economics than certain Nobel Econ Prize recipients, most congresscritters, and all MSM dolts.
As a triage interviewer at a local food bank, I speak with many folks who are doing exactly that.
I cannot get over how stupid, stupid, stupid, stupid these idiot reporters can be. They really believe that taking zero action to resolve the debt problem of spending more money than we take in and deciding to go get yet another credit card and max that one out is somehow a good thing. Good grief, people. Do you not understand that no one will want to lend money to someone who has been unable to balance its books for 56 consecutive years? The reason our credit rating went down (again) is because we have taken on almost $7 trillion in new debt in just under 5 years. And passing a resolution calling for more of the same only adds fuel to the fire. The only thing that can save our credit rating at this point is to stop raising the debt ceiling. Why can't these fools understand that? When they max out their personal credit cards, does VISA simply issue them a new one at the lowest rate possible? Seriously.
It’s not stupidity; it’s the purposeful, continual brain-washing of the 80%+ of the public that is brain dead and unwilling to think for itself.
Of course, you’re right. We’re all preaching to the choir here.
This is exactly where Republicans can finally do some good, by standing up, clearly explaining the problem (that they certainly have helped to create) over and over again to the public, until the MSM has no alternative but to report.
No, this is much worse than kicking the can. This is an agreement to (legally) pile on an additional $750 billion in debt over the next four months. Kicking the can would have been to simply leave the debt where it was and pay none of it down.
BTW—I don’t think that the Chinks have been buying ANY of our debt for some time now.
They have been dumping it on any “greater fools” that they could find and their net $$$ holdings have dropped from $3+ billion to less than half that.
Crafty, the$e Chine$e.
What has to happen is to get more downgrades and see our interest rates go up. Paying huge interest on our debt would get us closer to solving the problem. The tax money would be going to the people who deserve it more, the people who risked lending us money that it looks like they’ll never get back. They deserve it more than the welfare moochers. And without the welfare moochers getting their checks, and the Dems adding more and more of them to the welfare rolls ad infinitum as they continue to do now, those voters will lose their incentive to vote for Democrats. Interest rates hikes are probably the only thing that will kill off welfare programs and force us to control the spending that got us into this debt. That’s how debt works...when you don’t show an ability to pay, your lenders raise your interest rates and stop lending you more so that you stop spending above your means and pay what you already owe. The sooner the cost of having this debt goes up, the sooner we can start solving the problem.
The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned.
Essentially - to default on US debt, the president or Congress would have to actually take action to prevent payment of said debt. Even then - the 14th Amendment makes that rather difficult. The only real-world way the US debt could default would be if revenue dropped so much that there was not money available to pay the interest and principal payment... And even then, default is unlikely, as 100% of US debt is delineated in $US - therefore, more can be printed and used - and the debtor can say nothing.. Yes - it would radically damage our currency - deflation would be rampant... but they payments would be made.
Now - do the Chinese believe this president (and/or CONgress) might do such a thing to intentionally crash the economy? Who knows...
It takes a commie to know one.
I have several Russian acquaintances, and they all know what Obama is. They're very distressed that Americans can't see what's happening. I told them that few Americans know what Marxism is.
My dad escaped from Poland, and made sure I understood it.
Germany did the same thing back in the 1920s. And the only thing that solved that problem was the presence of French troops marching on the Ruhr. As long as this government exhibits a crackhead's willingness to print up more money to finance government, this charade will continue regardless of anyone else's willingness to purchase US debt, especially considering that the value of that debt decreases precipitously as fast as the money supply increases.
The real victim here is those of us who work for a living. The value of our income is stolen from us with each passing day as we compete for the same goods with dollars that are worth less. In 2008, you could put $100 worth of groceries on a table, and I could purchase them all for $100. But today when I approach that same table with my same $100, there stands beside me someone with an EBT card having a $40 balance. This means that there is now $140 competing for that same table of groceries. So I walk away with 5/7 of the groceries while the guy with the EBT card walks away with the remaining 2/7. And if I need to make up the lack for my family, then I will need to come up with another $40 and find another table of groceries to bid on.
Well here’s an idea:
Stop sending American jobs to China.
Have you shopped in an “American” shopping establishment recently.
It is ALL “Made in China”. Which means no American taxes have been paid, which means no money was provided for our military incidentally.
Further the people who (used) to work at the American company which was sold to China, are on welfare costing America more.
Bring back American jobs, now.
Same here. I also have a good friend from Venezuela. Back in 2008, she was horrified watching the rhetoric that was coming out of the Obama campaign. She said, "I've seen this before. I am watching Chavez again."
My response to American socialists is this: If socialism is so great, then why don't you move to Cuba or Venezuela. They never give me an answer, but I know that in their hearts their answer is that today's America offers more to loot than does Cuba.
But I thought that lifting the debt ceiling wouldn't mean an increase in debt. I'm beginning to question the president's integrity.
Let me ratchet up your post another notch or two! (And for the record, I agree - I HATE shopping at Walmart because of the overflow of China-made crap... ).
But lets look even deeper at the problem - there was a time when products were made in China because the manufacturing costs (labor, materials, etc.) were far cheaper.
And while China is still no utopia of high wages, benefits, and environmental laws... it has improved (on the $US being pumped there by the container ship load). The actual manufacturing costs for many of the common “China made” items at Walmart or your local hardware store or toy store, are not so glaringly different. Further - when you account for the transportation, storage, and relatively high defect rate - there is hardly a reason to manufacture lower-costs goods in China any more... so why do we still see so much of that stuff imported?
Regulation, hyper-opressive hand of government, TAXES, and now - Obamacare and its mandates (that require even employer-provided health plans to be “compliant”... rapidly raising costs for companies).
Throw in environmental stupidity, permitting stupidity, and so many more factors - we dis-insentivize the manufacture of ANYTHING domestically.
Add to it the “entitlement programs” (which for many are totally NOT entitled to) also dis-insentivizes work and work ethic. We have further expanded the definition of “disabled” to cover pretty much anyone or anything that you can think of - stuff that people just worked through even 10 years ago - and much more before the creation of this generally fraudulent program.
Why give up $2000-4000 per month in government programs ($24k-48K income per year, tax free) to go make $10-12 per hour doing “work”, and have to pay Social Security and FICA taxes - State Taxes, etc... and receiving little “Help” from the government?
A member of the church I pastor owns a tire and offroad accessory store - he cannot keep good, reliable employees - and it isn’t because he is a mean or unjust employer - he is generous, he provides benefits (even though he doesn’t have to). He simply expects and honest day’s work for an honest day’s pay. He has been trying to hire someone to fill an empty position for months now - and now has a second job opening (had to fire someone who just wouldn’t show up to work last week). Advertising, puts it on his sign out front - and no applicants... all while unemployment is still relatively high.
What in the world is going on? We have paid people so long to NOT work - they don’t want to work. How can an American manufacturer put in a factory, equip it, and then hire people they expect to do an honest day’s work? It’s far easier to ship the specs and designs off to a plant in China that will get it done.
And I think we can agree - this has all been a massive conspiracy in the works for a long time (going back to when Senator Joseph McCarthy tried to warn this nation of the Communists among us). They couldn’t take over directly... so they bought this nation with handouts and programs - thus buying votes and enslaving a nation.
The Chinese aren’t stupid.
I've been thinking of moving there.
I think America is stuck at the moment.
We’re not yet dead-beat broke, but we’re well on our way.
Americans still have some jobs. But the momentum is CLEARLY against American now.
The US corporate giants care diddly-squat about America strength.
Keep speaking up.
This is important.
We also are friends with a family from Venezuela.
Mom and kids came here 10 years ago while Dad tries to run a business back home.
She is considering getting her kids out of here now. She is very tight lipped about where or when. She believes that Obama has people listening for such talk.
Honestly, if the .gov’s weren’t mucking with the numbers, the US Credit rating should seriously be BBB/Baa2-ish.
The Chinese are smarter than our congress.
Thirty years ago, who would have imagined the role reversal?
Sure, will you pay $3,000.00 for an iPhone?
Strangely enough, the last time the U.S. was downgraded (after the 2011 debt ceiling mess), Treasury yields dropped. The downgrade led to increased volatility in the markets, which caused investors to seek "safe" investments: U.S. Treasury bonds (even though the volatility was caused by a U.S. downgrade)...
Primary Dealers always show up; they're required to by law as a condition of being a Primary Dealer.
No. I actually haven’t got an iPhone.
Got a cell just in case, a PC and cable tv. Old fashioned I guess.
Read it in Forbes or maybe heard Peter Schiff say it. If Apple was made in USA you`d pay about 3 Gs for their cell phone.