Banana republic, here we come
Even the cheerleaders at America's comical bond rating agencies are bearish on the federal government.
| Posted at 9:20 AM | Permalink |
|
About
This page contains a single entry from the blog posted on April 18, 2011 9:20 AM.
The previous post in this blog was Bad news from the robots.
The next post in this blog is How Tom Moyer will get your sewer bill payment.
Many more can be found on the main index page or by looking through the archives.
Comments (9)
http://www.cnbc.com/id/42645647
Is actually a better article on spin. It'll get furious the further into the re-election campaign we get.
I don't know if I'd say banana republic, but I could see us becoming Japan (look at their public debt ratio if you want a scare) - 20 years of plodding economics while a Korea/China eats their lunch.
The weird thing is the yen being so strong (part of Japan's problem) in spite of their deficit.
Posted by Steve | April 18, 2011 10:07 AM
Alas, we can't be Japan and enjoy its financial stability since we haven't financed our debt primarily through domestic savings (which we did by the way during WW II, so when WW II debt was paid off the funds flowed back into the US economony). Also, US debt looks a lot worse if mortage backed securities issued by Freddie/Fannie are included.
It won't take much of a move in the foreign appetite for holding US debt to have a pretty big impact our US net interest payments. One positive thing that has happened is US savings rates have recovered somewhat since 2008.
Posted by Newleaf | April 18, 2011 10:40 AM
Krugman says "no big deal":
http://krugman.blogs.nytimes.com/2011/04/18/sp/
Posted by Pete | April 18, 2011 10:48 AM
Loaf of bread, $10.....no big deal.
Posted by Skipper Bob | April 18, 2011 11:49 AM
I seem to recall that Krugman used to be an economist of some sort. Now he's David Brooks.
As Newleaf says, there are material differences between our situation and Japan's.
Posted by Snards | April 18, 2011 12:20 PM
"Krugman used to be an economist of some sort."
He still is. Except in his world the only reason a problem isn't solved is because the govt didn't throw enough money at it - And he can always win that argument, if for nothing else the inability to disprove his assertion.
Posted by Steve | April 18, 2011 12:38 PM
For what it's worth; PIMCO the world's largest bond fund firm, has dropped all long term US Treasury Bonds from it's core holdings.
Posted by Dave A. | April 18, 2011 1:09 PM
Didn't Moody's and S&P rate those dung-filled...er, excuse me, tranched mortgage securities as super top notch spiffy plus? So why do they continue to have any credibility seeing as they were exposed as being paid by the very interests they were supposed to be evaluating?
Arthur Anderson got smashed to smithereens for less. Of course the meat sacks...er, human beings who commit the travesties skate away keeping their share of the ill-gotten goods. The guy who fixed the printer just gets unemployed.
I'm leaning toward the the concept that the LLC (or SpA, or GmbH or whatever) is the worst construct ever. If you don't have any skin in the game, get the f' out! You own shares in TEPCO? Grab a potasium iodide tab and a shovel and get busy.
I like the term clawback because it rolls so gently off the tongue.
[Ahhh, I feel better. Thanks Professor B.]
Posted by Old Zeb | April 18, 2011 3:48 PM
Ya got your "progressives." Ya got your "conservatives." Is there some giant all-encompassing political conspiracy that's bent on--and apparently having success with--running this country out of the ditch into a new-world quagmire?
Posted by cros | April 18, 2011 5:15 PM