The U.S. economy is fucked up

[The_Ripper]

Standard & Poor's statement: US credit rating could be cut even further.

Standard & Poor’s says its unprecedented downgrading of the United States' AAA sovereign credit rating might be followed by further cuts if debt reduction measures slacken.

In a statement, it said blamed "prolonged controversy over raising the statutory debt ceiling" and said the political process in Washington remained "contentious and fitful".

It said:"We have lowered our long-term sovereign credit rating on the United States of America to ‘AA+’ from ‘AAA’ and affirmed the ‘A-1+’ short-term rating. We have also removed both the short- and long-term ratings from CreditWatch negative.

"The downgrade reflects our opinion that the fiscal consolidation plan that Congress and the Administration recently agreed to falls short of what, in our view, would be necessary to stabilise the government’s medium-term debt dynamics.

"More broadly, the downgrade reflects our view that the effectiveness, stability, and predictability of American policy-making and political institutions have weakened at a time of ongoing fiscal and economic challenges to a degree more than we envisioned when we assigned a negative outlook to the rating on April 18, 2011.

"Since then, we have changed our view of the difficulties in bridging the gulf between the political parties over fiscal policy, which makes us pessimistic about the capacity of Congress and the Administration to be able to leverage their agreement this week into a broader fiscal consolidation plan that stabilises the government’s debt dynamics any time soon.

[Matty]

America is fucked because of a lack of true leadership and integrity, not because of a downgrade from a rating agency who have zero credibility. Having said that, this could be the catalyst that puts in motion a siginificant chain of events. Things will certainly be getting interesting for the remainder of 2011 and those still in denial may have difficulty accepting a lot of it. I would say that everyone needs to be on their toes and with staying with positive energy. Good day.

[The_Ripper]

Is this the end of American empire? It's tempting to answer 'Yes'

After America's credit downgrading and the spectacle of deadlocked Congress, Alex Spillius in Washington argues that the US still has the power to solve its problems.

Did the American empire end last week? It is tempting to say yes.

Standard & Poor's decision to remove the world's economic superpower from its list of risk-free borrowers was a somehow fitting climax to a sorry chapter that exposed Washington's paralysis for all to see.

As much a political critique as a financial judgment, S&P's statement condemned the "effectiveness, stability and predictability of American policymaking", and indicted the gridlock that made a credible deficit-reduction deal impossible.

The agency had agreed with the Obama administration that $4 trillion needed to be saved from the $14.3 trillion debt over ten years. But the 11th hour deal to raise the borrowing limit and reduce the deficit that pulled the US back from the brink of a first ever default saved "only" a minimum of $2.1 trillion.

Mr Obama has yet to comment, and is spending the weekend at Camp David. The Treasury Department's only response was to accuse the rating agency of bad mathematics, saying they got their sums on deficit reduction over ten years wrong by $2 trillion, whatever that means.

The agency stated plainly that it did not trust Congress to make the agreed upon two-stage process to reach the savings work.

The deal agreed debt reductions of $900 billion, but the rest will have to be thrashed out by a special committee of Congress in the autumn, when the arguments of the last two months will be revisited all over again, causing more uncertainty for investors.

The world is one collapsed southern European economy away from disaster and crying out for American leadership, and Washington gave us another committee.

Republican deficit hawks in Washington - whom S&P singled out for failing to tolerate revenue-raising of any kind - like to disdain the mismanaged Mediterranean states as the PIGS - Portugal, Italy, Greece and Spain. But given the way their own country is coming apart at the seams, it could be called the Untied States.

Nearly one in six Americans is living on government food subsidies averaging $282 a month per family. The official unemployment rate is 9.1 per cent, but is much higher if the long-term jobless are included.

House prices have collapsed by 33 percent from the market's peak, more than the slide during the Great Depression. Despite Mr Obama's best efforts at stimulus spending, American infrastructure was awarded a grade of D by the American Society of Civil Engineers, with one in five bridges classified as "structurally deficient".

Larry Summers, until recently leader of Mr Obama's economic team, puts the odds of the US economy returning to official recession (it still feels like recession in most places) at one in three. Others would call that optimistic.

The debate of the past few weeks was so fractious because Americans are scared.

The Tea Party is terrified spending will bring the country to ruin. The Democrats dread that their cherished benefit schemes for the elderly and poor will be cut to pieces.

Underlying both outlooks is foreboding and fear that America's time as number one is up, that the continuous path of growth that transformed the country from the late 19th century onwards has come to an end.

Middle class wages have been stagnant for 15 years and the housing and credit boom that put some fizz into ordinary lives have dried up. Entrepreneurship, the prized and nation-defining quality, is in a long term decline - the theory is that a deregulated and expanded Wall Street sucked up too much business talent. The BRICs - Brazil, Russia, India and China - loom as a threat to US dominance, which was built on a manufacturing base that is steadily moving overseas.

The country has some major mental adjustments to make. It will have to accept a weaker military - one that doesn't outspend the rest of the world combined. Americans will have to accept that there are half a billion middle class people around the world who can do a lot of the jobs they can, and think of new ones.

Both people and politicians may have to settle in the long term for being first among equals, rather than towering above the rest.

The America of today has been compared to Britain in 1914 or Rome at the peak of their might, before their rapid falls from supremacy.

Unlike the British however, the Americans have not assumed control of large parts of the world from which they must inevitably retreat. For all their involvement in every foreign policy issue, their global commercial enterprise has few strings attached, while withdrawing from both Iraq and Afghanistan within a few years will be a boon.

The country leads in industries vital to the 21st century and, for all its gloom, remains hard-wired to strive to improve. As the preamble to the US constitution says, the people's goal is to "form a more perfect union". There is still nowhere on Earth that compares for creativity, experimentation and drive.

Perhaps S&P's decision could be the shock that Congress needed. The downgrade may well raise interest rates for consumers, which could make both sides think again about being so intransigent and finally bring the compromise so clearly needed and which has been a hallmark of the country's legislative history.

As they resume battle after their summer break, Democrats and Republicans should recall the words of Bill Clinton, who said: "There is nothing wrong with America that cannot be cured by what is right with America."

[virtuoso]

Look, all of this has been done by design, perhaps finally people will realise that.
Perhaps finally people in America will be screaming, blood curdling screams for the the 13 plus trillion back from the banks
Perhaps finally people will realise the treasonous acts committed by both sides of the political side
Perhaps people will scream for the reintroduction of the glass steagalz act
Perhaps now people can put their political differences to one side and go after the real enemy
Perhaps now finally people will demand the immediate cutting off of aid to the "too big to fail banks" or zombie banks as they have been du
Perhaps now people see both parties for what are, and force these politicians to stop being such stooges and cowards.

Or people will continue to allow the wholesale destruction of America, and will accept whatever medicine is prescribed to them and will ignore the fact that all of this was clearly layed out years ago.

[virtuoso]

As for Bill Clinton, he was the treasonous fuck that repealed the glass steagalz act.
Don't rely upon the media commentators for solutions when they have so willingly played the blind fool.

[BiggBoogaBiff]

Don't rely upon the media commentators for solutions when they have so willingly played the blind fool.

truth.  but tha real truth is Obama is scared of getting assassinated.  it's pretty clear that that's the reason why we're not getting shit.

[LooN3y]

Don't rely upon the media commentators for solutions when they have so willingly played the blind fool.

truth.  but tha real truth is Obama is scared of getting assassinated.  it's pretty clear that that's the reason why we're not getting shit.

u should be permanently banned from tot

[BiggBoogaBiff]

Don't rely upon the media commentators for solutions when they have so willingly played the blind fool.

truth.  but tha real truth is Obama is scared of getting assassinated.  it's pretty clear that that's the reason why we're not getting shit.

u should be permanently banned from tot

chink

[Matty]

[Hood Crawler]

Totally agree with all this shit. Banks, Government, and all in office are so corrupt. Americans are busting their asses to stay afloat and they keep bringing us down.