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Minnesota lost its top credit rating on Thursday as Fitch Ratings downgraded the state's general obligation bonds one notch to AA-plus, citing the budget impasse...
The credit agency faulted Minnesota's use of so-called "one-shots", or nonrecurring revenues, to close deficits during the recession, a pattern it said likely will be repeated in the new budget.
Do you feel if the US did something similar in August, it would lose is AAA rating?
And what effect would it have on the economy of the US and the global economy?
IMO, failure to raise the debt ceiling will be an extraordinarily irresponsible decision. It will also have long-lasting implications in the form of a higher cost of capital, even if it lasts just a few days.
Raising the debt ceiling as a short term response is fine to avoid the consequences of not doing it.
However we have to cut spending and borrowing to balance the budget.
I'm not sure how one figures that getting oneself even further into debt is the responsible action.
It's not getting further into debt. We already created it. It is about paying our bills, and not being deadbeats.
A regular business can't simply say that they've committed to X amount of employee's so we are simply stuck paying them.
There is a major difference between the public and private sector. Anyone expecting them to behave in similar fashion is naive.
Thank you, Mr. Sutherland. More than a few people on this board are advocating we just let the day come and go. I can't imagine what they're thinking.
‘I share that with you because it's similar to the challenges seen in Washington D.C. going on with this debt ceiling limit issue. They've got the President and Republicans negotiating, and I urge our Republicans in Washington D.C. to stand strong. The only way you get real change in Washington D.C. is to draw lines in the sand. And if you notice, most politicians are like running water downhill. They want least resistance. So it's helpful, in having them do bold and courageous things, to put up some points of resistance.’ ”
I apologize if you were drinking something hot when you read that.
Granted, the private sector creates all the wealth.
Thank you, Mr. Sutherland. More than a few people on this board are advocating we just let the day come and go. I can't imagine what they're thinking.
Probably because they're super poor and have nothing to lose? Ever notice how it was the rich folk who championed TARP? They had the most to lose from a financial collapse.
Actually not.
I can't really tell, but they seem to either be so pissed at the President, they're willing to do ye old "cut off nose, spite face" routine, or they ... I got nothing.
One claims to be rich, but since he doesn't use punctuation half the time, I can't honestly believe he's a success in life.
Well some of the detractors here have admitted to less then luxurious lives.
That is possible, the crazies here are numerous.
lol. I know what you mean. It does amuse me watching people try to compensate for piss arguments when circumstantial claims. I swear so many people here don't understand the differences between showing expertise and wealth and telling people you have it.
Yes, and deservedly so. Washington's policy makers should do well to consider the move Fitch made during Minnesota's shutdown. Even when that shutdown ends, its credit rating will almost certainly not be restored to AAA, because the bad decision making there has eroded confidence in its credit.
In the least bad outcome related to a failure to raise the debt ceiling (a short impasse of a few days' duration during which the country meets its debt obligations), the country would be left with a higher cost of capital that would slow macroeconomic growth and worsen its budget deficits. Something lengthier (weeks or longer) that disrupts significant amounts of payments would lead to a still higher cost of capital than the previous scenario and very likely a recession. Its during that longer scenario that debtholders could refuse to roll over debt, meaning the country would need to pay both interest and principal. That outcome would increase the risks of a full-fledged debt crisis with global consequences, especially if creditors' expectations concerning U.S. credit risk are materially lowered.
IMO, failure to raise the debt ceiling will be an extraordinarily irresponsible decision. It will also have long-lasting implications in the form of a higher cost of capital, even if it lasts just a few days.
Careful or you'll lose your Centrist rating by me. It's really tough to get on my centrist list, since you're the only one on it. You failed to support debt reduction measures when you said not raising the ceiling was irresponsible. That puts you squarely leaning left...not center. Don't believe me, keep an eye on who's "Liking" your posts.
Oh, please. EVERYBODY can see what's happening in Washington, and it's not just liberals.
http://www.nytimes.com/2011/07/05/opinion/05brooks.html
Of course, now the blog-o-sphere has decided that this obviously conservative journalist is no longer conservative, based on that post.
http://en.wikipedia.org/wiki/David_Brooks_(journalist)
People are going to say things. Shock-n-awe, y'all. It doesn't mean they've suddenly changed their political stance. It means they're honest.
Do you feel if the US did something similar in August, it would lose is AAA rating?
And what effect would it have on the economy of the US and the global economy?
Then liberals better get with the program, and start cutting spending.
2. The use of gimmicks to balance the budget during the recession is something that could have adverse implications for Tim Pawlenty's Presidential campaign (damages his fiscal credibility and undermines the credibility of his call for a balanced budget amendment).
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