Of course Standard and Poors rating service had to wait till after the stock market closed to announce this credit downgrade – or the market would have tanked another 500 points or more.
The question I have is this:
Is our Congress so incompetent that they did not see fit to determine from the credit rating agencies exactly what needed to be done to prevent a downgrade?
Every member of Congress who voted for the kick the can down debt ceiling increase – EVERY ONE – is responsible for this historic credit debacle. They ALL need to be SHOWN THE DOOR. EVERY ONE OF THEM.
This is historic and tragic. It didn’t need to happen. This downgrade will cost taxpayers billions more than the worst natural disaster we have had to date.
It is doubtful the market has factored in this credit downgrade in its recent decline. It was caused primarily by Europe’s troubles as evidenced by the Friday bounceback right after Germany promised to bail out Italy. And gold would have bounced up, not floated down. Monday’s market reaction to this downgrade will be something to watch in awe – as in awe crap.
And this is not the worst news. Here is an excerpt of the S & P report:
The outlook on the long-term rating is negative. We could lower the long-term rating to 'AA' within the next two years if we see that less reduction in spending than agreed to, higher interest rates, or new fiscal pressures during the period result in a higher general government debt trajectory than we currently assume in our base case.
Interest rates are almost certain to rise as a result of this downgrade. There will be a further reduction in our credit rating if interest rates rise. Another downgrade within a few months is very likely unless Congress revisits this issue immediately and makes the necessary adjustments.
What should we do about this? Get on the phone and computers and send a message to your Congressmen to get their royal asses back to DC to fix this problem. They and the President have created this problem. There is no one else to blame beyond Congress, the President and his socialist administration. The President is useless - beyond help. He will attempt to blame republicans and probably Bush again. But remember this: Obama is the one who threatened a veto of any really effective debt-cutting bill. Congress is the one who did the voting. They can fix it. And if the President vetos it, he ought to be arrested and jailed for being a seditious usurper of office, or if you believe he is a legitimate president, impeached.