U.S. CitiesCity-Data Forum Index
Go Back   City-Data Forum > General Forums > Politics and Other Controversies
 [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 07-29-2011, 02:43 PM
 
22,769 posts, read 28,809,827 times
Reputation: 14658

Advertisements

does anyone actually think that U.S. Treasuries would be a riskier investment than AAA-rated mortgage backed securities were in 2007-2008?

I'm not asking if the default itself matters, I'm asking whether anyone thinks this "downgrade" will matter.
Rate this post positively Reply With Quote Quick reply to this message

 
Old 07-29-2011, 02:49 PM
 
42,727 posts, read 27,741,599 times
Reputation: 14317
Yes. A downgrade will matter. Interest rates will go up, not just for the government but, in the spirit of trickle-down economics, it will eventually impact all of us.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 07-29-2011, 02:56 PM
 
22,769 posts, read 28,809,827 times
Reputation: 14658
Quote:
Originally Posted by DC at the Ridge View Post
Interest rates will go up
Since it's never happened before, we don't know that this will be the result.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 07-29-2011, 03:01 PM
 
42,727 posts, read 27,741,599 times
Reputation: 14317
It hasn't happened to the United States before. But other countries have had their credit downgraded, and higher interest plus greater oversight by international interests have been the result. The inevitable result to a credit downgrade is that more of a nation's resources have to be used towards that debt, and when more resources go to the debt, there are fewer resources for other things, like infrastructure, for instance, or education. And when that happens, investors are more wary. It's a downward spiral that we want to avoid.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 07-29-2011, 03:03 PM
 
Location: Portland, OR
8,802 posts, read 8,357,976 times
Reputation: 4510
Quote:
Originally Posted by DC at the Ridge View Post
Yes. A downgrade will matter. Interest rates will go up, not just for the government but, in the spirit of trickle-down economics, it will eventually impact all of us.
Please explain how this relates to trickle-down economics. Thx.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 07-29-2011, 03:06 PM
 
Location: Raleigh, NC
20,056 posts, read 17,231,101 times
Reputation: 3826
Quote:
Originally Posted by DC at the Ridge View Post
Yes. A downgrade will matter. Interest rates will go up, not just for the government but, in the spirit of trickle-down economics, it will eventually impact all of us.
Liberals don't believe in trickle down economics, so all is good in their eyes.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 07-29-2011, 03:06 PM
 
Location: Wisconsin
30,473 posts, read 17,421,798 times
Reputation: 9877
Quote:
Originally Posted by DC at the Ridge View Post
Yes. A downgrade will matter. Interest rates will go up, not just for the government but, in the spirit of trickle-down economics, it will eventually impact all of us.
Agreed!

I think there is no doubt but that our rating will be downgraded, since 0bama and Reid have no intentions of slowing the rate of deficit spending,

Last edited by CaseyB; 07-29-2011 at 04:13 PM.. Reason: off topic
Rate this post positively Reply With Quote Quick reply to this message
 
Old 07-29-2011, 03:07 PM
 
Location: Raleigh, NC
20,056 posts, read 17,231,101 times
Reputation: 3826
Quote:
Originally Posted by VTHokieFan View Post
Please explain how this relates to trickle-down economics. Thx.
Since trickle-down isn't actually an economic theory but rather a strawman buzzword by those opposing anything resembling laissez-faire, you probably won't get a reliable answer anytime soon.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 07-29-2011, 03:13 PM
 
22,769 posts, read 28,809,827 times
Reputation: 14658
please try to stay on topic. I'm asking about the predicted effects of the credit downgrade, not trickle-down theory, or the size of the debt, or Obama and Reid.

I think the effect will be the complete opposite. Interest rates may rise immediately following the downgrade, but ultimately the $1 trillion or so that would be removed from the economy would cause a severe economic contraction, causing a flight to safety, and cause rates to fall.

I think the Credit rating agencies' opinions are of little value. Their AAA-rated bonds failed in 2008, and no one who manages money for a living will care that these have been downgraded.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 07-29-2011, 03:21 PM
 
Location: Raleigh, NC
20,056 posts, read 17,231,101 times
Reputation: 3826
Quote:
Originally Posted by le roi View Post
not trickle-down theory
No such thing.

Quote:
I think the effect will be the complete opposite. Interest rates may rise immediately following the downgrade, but ultimately the $1 trillion or so that would be removed from the economy would cause a severe economic contraction, causing a flight to safety, and cause rates to fall.

I think the Credit rating agencies' opinions are of little value. Their AAA-rated bonds failed in 2008, and no one who manages money for a living will care that these have been downgraded.
Yup, this I agree with. A lot of liberal doom and gloomers who used to make fun of other conservative doom and gloomers.
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 > Politics and Other Controversies
Similar Threads

All times are GMT -6. The time now is 10:43 AM.

© 2005-2022, 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