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"Further downgrades may be in store for Austria, Belgium, Cyprus, Estonia, Finland, France, Ireland, Italy, Luxembourg, Malta, the Netherlands, Portugal, Slovenia, and Spain with S&P placing them on negative outlooks – suggesting it sees at least a one-in-three chance that the rating will be lowered in 2012 or 2013." S&P announces mass of European ratings downgrades | The National Business Review
a compliment. Despite all your rants, the investors of 2012, just like 2002, 1992, and 1972, understand we are the best nation to lend to. And our debt/GDP ratio will remain superior to the EU. Who else can actually compete for the money? Since they know Asia cannot be trusted to respect any intellectual or real property rights, that continent wipes itself out.
Sure Bob. Wait until interest rates tick up even three percentage points. When we have the majority of our federal revenues going to service the debt, this whole house of cards falls apart.
When debt was smaller and we actually had a manufacturing sector, an upwardly mobile middle class, no NAFTA, and no China most favored nation trade status, this "growing out of debt" made sense. However, the sense it made was marginal, as even with economic winds behind us, debt continued to grow through these years, inspite of increases in GDP.
Now if your logic was correct, why has the debt never been reduced with increases in GDP? Answer- increased spending, which is out of control. If we had "Clinton era" (I prefer to call them Gingrich era) levels of spending adjusted with inflation, we would have $200 billion in annual surpluses. Yet we have $1.3 trillion in annual deficits.
Even the darling of your Keynesian economic theory, the Nobel Prize winner Stiglitz, has no answers when debt reaches levels in which the majority of revenues go to service the debt. The lunacy of leftist economic policy will be the undoing of the nation. When that occurs, libs will never blame themselves, but will seek other scapegoats for thier failure.
14th with a still very healthy credit rating which allows us to incur super low interest expenses. I'd also bet on several EU nations falling below us as the full wrath of the bailouts of 3 fellow EU nations harms them financially as well.
Sure Bob. Wait until interest rates tick up even three percentage points. .
3 will not happen. 1 point, perhaps.
We are at the beginning of a tough 20 year period, after that spending increases level off. The 20 year blip is due to a ratio-a baby bust is servicing a baby booms' retirees. After 20 years, one baby bust supports another baby bust, and SS/Medicare outlays while rising per capita due to inflation and ever greater medical technology, will also slow due to a healthier ratio active employees/retirees.
It was a freak occurrence to have a baby bust follow a boom, with so rapid a change.
Irrelevant. The big question is how do you intend to pay for the trillions of dollars we borrow, Bob?
Inflate away the value of the borrowed dollars.
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