Can you explain the US debt crisis

taktikz said:
Public Debt is all the obligations of the federal government to everyone outside the federal government (states, institutions, etc)
Total Public Debt is with the government included.

China owns the most securities of the US because they "loaned" us the money by buying our "securities".
Click to expand...


"Foreigners hold about 47 percent of US public debt. And yes, the largest foreign holder here is China – but only by a hair. Chinese investors are owed 9.8 percent of US debt. Next comes Japan, at 9.6 percent, and the United Kingdom, at 5.1 percent.

Oil exporting nations as a group, including Saudi Arabia, Oman, the United Arab Emirates, etc., account for about 2.6 percent of US debt. Brazil has 1.8 percent. The rest is split among lots of other countries.

So if anybody tells you that Americans work for China now, since they hold all our T-notes and can yank our fiscal chain, tell them that’s an exaggeration."

National debt: Whom does the US owe? - CSMonitor.com

Lots of hysteria here. I do laugh when the ratings agencies threaten to downgrade US Treasuries. Oh yeah Moody your opinion matters to me. Like I'm gonna buy Chinese yuan or Russian roubles.

Prem's getting big in US Treasuries UPDATE 2-Fairfax sees Treasuries as solid long-term bet | Reuters

He's a contrarian who has money than, um, everybody on wicked fire combined like ten times over.

You guys keep drawing conclusions from what the numbskulls on CNN and Fox fart out of their backsides. Look elsewhere for enlightenment.
 
Last edited:
  • Like
Reactions: BlokBlok


Benji49 said:
"Foreigners hold about 47 percent of US public debt. And yes, the largest foreign holder here is China – but only by a hair. Chinese investors are owed 9.8 percent of US debt. Next comes Japan, at 9.6 percent, and the United Kingdom, at 5.1 percent.

Oil exporting nations as a group, including Saudi Arabia, Oman, the United Arab Emirates, etc., account for about 2.6 percent of US debt. Brazil has 1.8 percent. The rest is split among lots of other countries.

So if anybody tells you that Americans work for China now, since they hold all our T-notes and can yank our fiscal chain, tell them that’s an exaggeration."

National debt: Whom does the US owe? - CSMonitor.com

Lots of hysteria here. I do laugh when the ratings agencies threaten to downgrade US Treasuries. Oh yeah Moody your opinion matters to me. Like I'm gonna buy Chinese yuan or Russian roubles.

Prem's getting big in US Treasuries UPDATE 2-Fairfax sees Treasuries as solid long-term bet | Reuters

He's a contrarian who has money than, um, everybody on wicked fire combined like ten times over.

You guys keep drawing conclusions from what the numbskulls on CNN and Fox fart out of their backsides. Look elsewhere for enlightenment.
Click to expand...

Awesome post +1
 
Do any of you actually know what you are talking about? The little pictures are nice but hardly are worth 1000 words to anyone who does not get your joke.

Benji49 is right - let me know how many Russian bonds you want.

No one is certain the long term effects of a bond rating change - all speculation, and all of this presumes we still play "by the rules". That cannot be assumed from any government given history.

Here's an interesting pic.

RATING_WF.jpg
 
leadsupplier said:
if we lose our AAA rating, what happens to the dollar? Like immediately, not in the long term
Click to expand...

good question. anyone?

Uncertainty in markets is never a good thing - but the immediate reaction? I am certain this is a hot topic in every trading room/forum in the world right now. I am certain the market has priced in the expected last minute crap deal - but what if it does not happen?
 
if you watched that video above with Dr. Kolburn, the latest one not the majrijuana one.. he briefly talks about the credit rating dropping and says it's going down no matter what...

personally, how the FUCK do we have a credit rating? like i have one b/c i have credit cards and shit, there are businesses higher up than me that have power over me .. so who has the higher power over the govt? i would say the fed, but all countries have a credit rating and the fed doesn't print them money. It's like who is this invisible superpower in charge of the world?
 
Having a credit rating isn't about having power over someone. It's just a form of measuring someone's credibility and likelihood of repaying their debts. If you have a good credit rating it's because you have a history of paying your bills, have income, etc. Based on those things people believe that you will continue to be reputable and assign you a score relative to other people. In the case of countries an AAA rating means that relative to other countries, we are very likely to repay our debts.
 
Sports Illustrated isn't more powerful than the major sports leagues, but if SI ranks the top players, people pay attention. They don't have to agree with the rankings, but because of the reputation that SI has earned, it will at least be looked at. Obviously the credit rating agencies hold much more power than a magazine, though.

As for what happens if the US loses its AAA rating, who knows; but it's worth pointing out that Canada and Australia went down to AA, the world didn't come to end, and they are both now back at AAA.
 
I think the root of our problems was when we got rid of the gold standard many moons ago.

Not sure it would have been realistic or possible to stay on the gold standard, but now we have an economy and system based mostly on thin air and paper. That money you hold in your hand is truly worth nothing, it's just colored paper.
 
BoldBacklinker said:
I think the root of our problems was when we got rid of the gold standard many moons ago.

Not sure it would have been realistic or possible to stay on the gold standard, but now we have an economy and system based mostly on thin air and paper. That money you hold in your hand is truly worth nothing, it's just colored paper.
Click to expand...
Skip to 4:57 for the lulz
[ame=http://www.youtube.com/watch?v=2NJnL10vZ1Y]‪Ron Paul vs Bernanke: Is Gold Money? - July 13, 2011‬‏ - YouTube[/ame]
 
leadsupplier said:
didn't know canada and austratrailia went to AA ... that's encouraging
Click to expand...

In the early 1990s, the government ran a deficit of $40+ billion. (Canada is 1/10 the size of US with regard to GDP, that was in 1990s dollars, and we weren't the reserve currency)

The Liberals, who were in charge at the time, took a freakin' hacksaw to public servant wages who reacted by going on strike.

For about two weeks, every federal public servant was on strike (except for the military).

I was in my early twenties at the time. It was hysterically funny at the time unless you were one of the poor saps trying to suck on government booby. Because nobody else gave a rat's ass that the government was on strike.

The government didn't even legislate the public servants back to work because they were saving so much money by not having them come into the office.

After two (3? My memory isn't that great) weeks the unions were broken. A couple of years late we started running federal budget surpluses and didn't run a deficit again until 2007.

Trust me, if you guys down south were having a REAL crisis, then the drama would be over pretty quick. I mean jeepers, it wouldn't be the end of the world if you could walk into an airport without some FTA guy grabbing your crotch.
 
Benji49 said:
I was in my early twenties at the time. It was hysterically funny at the time unless you were one of the poor saps trying to suck on government booby. Because nobody else gave a rat's ass that the government was on strike.

The government didn't even legislate the public servants back to work because they were saving so much money by not having them come into the office.
Click to expand...

I hope something like that happens here. The only problem is those bureaucrats and their friends and families all go out to vote, and will vote against people who take their monies away. So politicians tend to bow down to them. I hear going after pensions in particular is the absolute kiss of death politically, next to personal drama.
 
If you could blame one single person, for creating the mess in the first place. This is the guy -
greenspan.jpg


and Benny has probably beaten him now
 
leadsupplier said:
if we lose our AAA rating, what happens to the dollar? Like immediately, not in the long term
Click to expand...

REIMktg said:
good question. anyone?

Uncertainty in markets is never a good thing - but the immediate reaction? I am certain this is a hot topic in every trading room/forum in the world right now. I am certain the market has priced in the expected last minute crap deal - but what if it does not happen?
Click to expand...

The Tuesday Podcast: Would A Downgrade Matter? : Planet Money : NPR

Turned on CNN the other day and I was amazed by the fear mongering going on about what a downgrade truly means. It's criminal.
 
You must log in or register to reply here.
Top Bottom