Hi,
The recent news on Standard and Poor's credit rating information that came out recently and lowered the United States credit rating was a real blow to AMERICA'S standing in the Global community!!!!!!!!!!!!! THIS IS NOT AN ITEM TO BE OVERLOOKED. IT IS IMPORTANT!!!!!!!!! These credit rating agencies NOW ALL BUT RULE THE WORLD OF TRADE AND FINANCIAL MATTERS!!!!!!! NO KIDDING AROUND. The world changed from Communist control to Capitalist control when the WALL CAME DOWN IN BERLIN!!!!!!!
Unfortunately, our voters did not notice that CHANGE AND A NEW WORLD ORDER was packaged into INTO CAPITALISM AND GLOBAL TRADING NOT COMMUNISM!!!!!! SO AMERICA IS CURRENTLY DEALING WITH COMBATING THE ANCIENT SYSTEM OF COMMUNISM, WRITHING IN THE PAINFUL THROES OF DEFEAT, while the rest of the world has moved on!!!!!!!!
What many people have not been kept informed about is how important these CREDIT RATING AGENCIES have become because of global trading and it is a real reprimand to President Obama and his administration and their handling of financial matters.
STANDARD AND POOR'S AND agencies like them "LIKE" NOW "RULE" THE WORLD AND WHAT THEY SAY INFLUENCES ALL FINANCIAL INTERACTIONS. Sure we don't have to play by their rules but the rest of the world doesn't have to trade with us, loan us money and could demand IMMEDIATE REPAYMENT OF ALL LOANS WITH INTEREST!!!!!!!!HAVE YOU CHECKED LATELY TO SEE HOW MUCH WE OWE??????????
Because global trading has introduced CAPITALISM to most of the world, certain inflexible rules have come into play that govern who borrows what, where and when! Somehow this seems to have slipped past the attention of the ruling hierarchy in Washington, who can no longer do as they DAMN WELL PLEASE in financial matters and expect the GLOBAL COMMUNITY TO SUPPORT THEM.
ISN'T IT IRONIC??????? AMERICA INTRODUCED CAPITALISM TO THE MODERN WORLD and we are using it so badly that the agencies who govern the credit ratings have to slap us on the wrist!!!!!!!!
The reason I started 73 ISSUES AGO writing this ECONOMICS BLOG WAS REINFORCED IN THE NEWSPAPER THIS WEEK!!!!!!!!!!!! Some erstwhile Economists had some NINCOMPOOP IDEAS ON DEBT. Obviously, they had been asked to REBUT the idea that a GOVERNMENT BUDGET could be handled like a PERSONAL BUDGET. That is not necessarily TRUE OR UNTRUE but the lead SENTENCE DROVE this blogger UP THE WALL!!!!!!
This is the lead: 'DEBT IS NOT ALL BAD FOR GOVERNMENT'. That evidently MEANS particularly IF you DON'T HAVE TO REPAY IT!!!!!!!!!!! Yeah right. Tell that to Standard and Poor's rating facility!!!
DEBT IS A TERM THAT MEANS 'THAT WHICH HAS BEEN UNPAID'. It is not called 'UNLIMITED DEBT' OR DEBT THAT DOESN'T HAVE TO BE REPAID (that's called A GIFT), OR DEBT THAT YOU HAND DOWN TO YOUR CHILDREN (that's been the case since the depression in the thirties)OR DEBT THAT YOU INCUR JUST BECAUSE YOU CAN!!!!!!!!!!OR DOZENS OF OTHER DEFINITIONS.
DEBT PLAIN AND SIMPLE IS MONEY BORROWED FROM SOMEONE OR SOMEWHERE THAT IS EXPECTED TO BE RETURNED HOPEFULLY WITH A REWARD CALLED INTEREST!!!!!!!!!THAT'S WHY (PRIMARILY) IT'S LENT. In Government there are other factors which mostly add up to nice words for bribery. As in: "if I loan you this money, you'll let me do.....WHATEVER in the future, OK???????????"
That's what A LOAN is whether it is a PERSONAL LOAN or a GOVERNMENT LOAN. It is SOMETIMES the ONLY way TO HAVE TO DO BUSINESS IN CERTAIN CASES. The GASPING ECONOMISTS CITED THE FACT THAT AMERICA HAS BEEN IN DEBT SINCE THE THIRTIES' DEPRESSION as a reason that it is NOT A BAD THING!!!!!!!!PLU...........EZE!!!!!!!!!! Because countries have mismanaged their finances DOES NOT MAKE IT RIGHT OR GOOD!!!!! IT SIMPLY MAKES IT A FACT that will take a FINANCIAL GENIUS to RECTIFY!!!!!!!!!
We can somewhat compare personal debt to Government debt by using a personal debt based on Government and bank controlled borrowing. A mortgage can last 20-30 years in a personal budget, payments are made, and relief is great if it gets completely paid off and the mortgagee is property debt free!!!!!HOORAY.
HOWEVER, WHEN WELL-MEANING BUT DELUSIONAL GOVERNMENT LOANING AGENCIES SADDLE UP UNSUSPECTING, UNTUTORED, OR DECEITFUL HOMEOWNERS WITH two, three, four mortgages unaffordable on a given income THAT IS CALLED MELTDOWN!!!!!!!!!! Many Homeowners felt they must have been capable of eventually repaying the loans if someone was willing to lend them all that money. The FEDERAL GOVERNMENT OBVIOUSLY SIMILARLY FEELS THAT AS LONG AS OTHERS ARE BUYING THEIR BONDS (and many bonds today are pretty iffy) AND A FEW CORPORATIONS HAVE TAXABLE INCOME--THE GOVERNMENT CAN CONTINUE TO CREATE MORE DEBT!!!! STANDARD AND POOR'S DOES NOT AGREE and made it CLEAR they did not like OBAMA CARE!!!!!!!!!the new health bill.
It is the TINKERING AND THINKING OF ECONOMIC FEDERAL GOVERNMENT NINCOMPOOPS THAT CREATES THE DEEP DO DO!!!!!!!!! That kind of thinking brought us to the brink of ECONOMIC DESPAIR with the MORTGAGE LOAN DEBACLE AND WILL BRING US TO OUR KNEES IF THE DEBT KEEPS MULTIPLYING. OUR RATING CAN GO THROUGH THE FLOOR SO FAST OUR FINANCIAL COINS WILL SPIN!!!!!!!!
The STOCK MARKETS ARE continuing with sharp PLUNGES to reflect on GOVERNMENTAL FOOLISHNESS WORLD-WIDE. IN RECENT YEARS THE UNITED STATES HAS NOT SET A VERY GOOD EXAMPLE OF FISCAL REALITY in Capitalist markets. STANDARD AND POOR'S NEW RATING REFLECTS THAT!!!!!
Unfortunately too many in Congress today listen to these over-educated Economists, who are in the first trimester of their understanding of Government finances or any kind of budget and make formal and confusing pronouncements. Of course, the Government can apply budgetary information to their structure of finances based on some different parameters.
I do agree with these newspaper Economists and their "debt isn't all bad' on ONE POINT. We cannot NOW SOLVE the GOVERNMENT'S DEBT BURDEN with ordinary BUDGETING. AMERICA is BURDENED BY SO MUCH INTEREST AND DEBT that ERECTING A STABLE SPENDING PROGRAM BASED ON the past borrowing may be beyond the intellect and imagination of MOST ECONOMISTS, who rely on JUSTIFYING BAD BUSINESS PRACTICES BY CITING BAD BUSINESS PRACTICES!!!!!!!!!!!
WHEN AN INDIVIDUAL GETS into UNPAID DEBT,they have only a very few options:sell off assets at a possible loss, pay down slowly, go into bankruptcy, or shoot oneself and leave it to one's heirs. NOT A PRETTY SCENARIO and since most folks don't like the choices, it behooves FOLKS to keep a pretty balanced budget. If the individual understands the limits of personal finance even in the case where the controlling financial institutions may try to lead them astray, they won't be led down the primrose path as many were in the HOUSING MORTGAGE "FREE FOR ALL" THAT BECAME A CRISIS!!!!!!!!
THAT PRIMROSE PATH WAS BASED ON JUST THE KIND OF ECONOMIC THINKING THAT THE RECENT NEWSPAPER ARTICLE CITED. Guess what??????????SOME IF NOT ALL ECONOMISTS HAVE LEARNED NOTHING FROM THE HOUSING DEBACLE!!!!!!!!
Government needs to respond to the call from the citizens for FISCAL RESPONSIBILITY.The voters are RIGHT!!!!!!!!!! It has to start with some real changes in spending. Unfortunately, we can do nothing about the past debts.
Although it has occured to me that the OLD SYSTEM OF BARTERING MIGHT BE CALLED INTO PLAY. We TRADE DEBT for something THE DEBT HOLDERS want to OFF LOAD. There are always trades between countries and some of them are costly. Governments just have to remember the old saying: "DON'T GIVE AWAY THE STORE with the goods!"
However, the first fiscal policy that comes into play in any BUDGETARY problem is REDUCE EXPENSES SO THAT THEY EITHER MATCH OR ARE UNDER INCOME.
In order to do this the Government must CONTROL NEW SPENDING and plan their BUDGET PERHAPS AROUND the DEBT NOW OWED AND ITS INTEREST. MAYBE, THAT DEBT WILL HAVE TO COME OUT OF SPECIAL FUNDS FROM NEW TAXES HIDDEN IN NEW BILLS RECENTLY PASSED!!!!!!!!!!
IT WON'T BE EASY AND IT WON'T BE FAST!!!!!!!!! But if we can solve the DEBT CRISIS CREATIVELY, (AND NOT COMMIT SUICIDE AS A COUNTRY WITH POOR RATINGS) WE CAN ONCE AGAIN BE HEROES TO THE REST OF THE WORLD who also need to find their way through the FINANCIAL MIRE.
America probably has some great FINANCIAL BRAINS--turn them LOOSE--to THINK CREATIVELY and get America off the OLD FINANCIAL HIGHWAYS. CREATIVITY IS NOT JUST FOR THE ARTS!!!!!!!!!! GENIUS CAN SOLVE MOST PROBLEMS WITH CREATIVITY. If AMERICANS DON'T have the FINANCIAL CREATIVITY anymore then TUNE IN to those who do WHEREVER THEY ARE.
THIS CAN BE A GREAT OPPORTUNITY since most of the countries in the world have ENCOUNTERED REAL FINANCIAL PROBLEMS. SOLUTIONS COME WHEN MOST FOLKS ARE IN NEED OF THEM!!!!!!!! LISTEN, CHANGE, CREATE A NEW FINANCIAL OUTLOOK based on Global changes!!!!!!!!!!
AND PAY ATTENTION TO STANDARD AND POOR'S--THEY ARE THE PRESENT AND FUTURE OF CHANGE!!!!!!!!!!
FISCAL RESPONSIBILITY AND REDUCING DEBT!!!!!!!!!
PROFOUND!!!!!!!What a REVELATION!!! YOU'RE WELCOME!!!
CHEERS, CONNIE
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