U.S. CitiesCity-Data Forum Index
Covid-19 Information Page
Go Back   City-Data Forum > General Forums > Economics
 [Register]
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
Reply Start New Thread
 
Old 08-25-2010, 10:19 AM
 
Location: PA
563 posts, read 837,558 times
Reputation: 229

Advertisements

Morgan Stanley Says Government Defaults Inevitable - Bloomberg

We are in for some seriously rough times. Does is seem to everyone that the closer we get to the cliff, the harder we push the gas?
Rate this post positively Reply With Quote Quick reply to this message

 
Old 08-25-2010, 01:06 PM
 
13,333 posts, read 23,377,445 times
Reputation: 13595
Ehh, not really.

Quote:
“Outright sovereign default in large advanced economies remains an extremely unlikely outcome, in our view,” the report said.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 08-25-2010, 03:46 PM
 
Location: WA
5,508 posts, read 22,318,570 times
Reputation: 6191
While sovereign debt can be covered with inflated currency, state government will simply default.

Many states have only three choices, huge and damaging tax increases with budget cuts, a bail-out by the federal government, or default.

As long as we have politicians in charge of taxes, spending, and the budget process we are doomed to default. Maybe we need a different form of fiscal structure... perhaps separate operational management and public leadership structures with improved checks and balances.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 08-25-2010, 06:37 PM
 
Location: PA
563 posts, read 837,558 times
Reputation: 229
wheelsup,
Over the past couple of years, many things said to be "unlikely" concerning the economy have proven true. Unemployment, depth of the housing crisis, even GM before the govt finally stepped in. I did catch that, though, and agree it is unlikely. But I wouldn't rule it out.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 08-25-2010, 09:54 PM
 
13,333 posts, read 23,377,445 times
Reputation: 13595
Quote:
Originally Posted by WonderingWanderer View Post
wheelsup,
Over the past couple of years, many things said to be "unlikely" concerning the economy have proven true. Unemployment, depth of the housing crisis, even GM before the govt finally stepped in. I did catch that, though, and agree it is unlikely. But I wouldn't rule it out.
Your OP is incredibly misleading. The article title was talking about small governments like Greece and Ireland, not the US.

Germany defaulted after WWI, look where they are now. One of the strongest countries in the world, with a trade surplus.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 08-26-2010, 04:32 AM
 
Location: Raleigh, NC
20,003 posts, read 16,480,731 times
Reputation: 3783
Quote:
Originally Posted by wheelsup View Post
Your OP is incredibly misleading. The article title was talking about small governments like Greece and Ireland, not the US.

Germany defaulted after WWI, look where they are now. One of the strongest countries in the world, with a trade surplus.
Yeah, I heard they got a dictator who promoted massive inflation and invited death and destruction in the meantime...and the people welcomed it.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 08-26-2010, 05:29 AM
 
Location: Londonderry, NH
41,478 posts, read 53,724,981 times
Reputation: 24695
I doubt the Federal government will ever default. That would not be in the best interest of the upper five percent that own most of the debt. I also expect the Federal Treasury, along with massive cuts in social spending, to bail out the States. Eventually, the primary causes of the problem, along with the primary beneficiary, the very upper level private finance sector, will realize the gamblers have lost all the wealth and will suffer a very devastating revaluation of the their assets. I expect it to be on the order of the Louisiana Stock Bubble crash or the South Pacific crash in the 18th century. Then it will take a while to begin a recovery.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 08-26-2010, 09:29 AM
 
Location: PA
563 posts, read 837,558 times
Reputation: 229
Quote:
Originally Posted by wheelsup View Post
Your OP is incredibly misleading. The article title was talking about small governments like Greece and Ireland, not the US.

Germany defaulted after WWI, look where they are now. One of the strongest countries in the world, with a trade surplus.
Wasn't trying to mislead, and not implying it's imminent. I did find it interesting the article notes we have one of the highest debt as a percentage of revenue (358%).
My thoughts are as various things like healthcare "reform" phases in, more people lose their home, lose their unemployment payments, etc, those will weigh more and more on our already greatly strained system.

Also, Germany walked a long, hard road from WWI to today.

Last edited by WonderingWanderer; 08-26-2010 at 09:29 AM.. Reason: grammar
Rate this post positively Reply With Quote Quick reply to this message
 
Old 08-26-2010, 11:24 AM
 
4,522 posts, read 3,648,145 times
Reputation: 13776
A government doesn't necessarily need to go into a monetary default before it's citizens and global creditors feel some mighty big pains. The question of US default seems like a straw man argument for those who deem the American economy to be in need of simple tune up and proof of that is the fact that our government hasn't defaulted, yet. Using the standard metrics of the past to measure the present state of our economic health won't work, we'll see the proof of this in forthcoming government reports of unemployment numbers that will become outright laughable.

The Dow's numbers will not be a very reliable measure of the true condition of corporate financial strengths either, thinking that we can sail in the uncharted waters of this very different sea of economic woes could really be our undoing, will we see the truth of things before the consequences of economic short sightedness and ignorance is upon us? We need to devise a new way of measuring the real economic pain of real people and not just that pain experienced by corporate interests. There is a very unique strength that humans can garner from their knowledge that their pain is common among the populace and therefor the cure will have a widespread demand, that's the thing, will we demand anything more from our government than it's bare survival?
Rate this post positively Reply With Quote Quick reply to this message
 
Old 08-26-2010, 12:07 PM
 
Location: PA
563 posts, read 837,558 times
Reputation: 229
Quote:
Originally Posted by jertheber View Post
We need to devise a new way of measuring the real economic pain of real people and not just that pain experienced by corporate interests. There is a very unique strength that humans can garner from their knowledge that their pain is common among the populace and therefor the cure will have a widespread demand, that's the thing, will we demand anything more from our government than it's bare survival?
Well said. Humbling and true.
Rate this post positively Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply
Please update this thread with any new information or opinions. This open thread is still read by thousands of people, so we encourage all additional points of view.

Quick Reply
Message:

Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > General Forums > Economics
Follow City-Data.com founder on our Forum or

All times are GMT -6. The time now is 03:52 AM.

© 2005-2020, Advameg, Inc. · Please obey Forum Rules · Terms of Use and Privacy Policy · Bug Bounty

City-Data.com - Contact Us - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37 - Top