I am blogging this as this is so important:S&P downgrades US credit rating from AAA!
I am wondering now if there is still a way out for USA. What I know, as I have been there done that, unless you declare a bankruptcy and start over, you are done for. You will be a slave to interest payments for life, and eventually face the inevitable: bankruptcy!
Here are some specific details of the increase of gross public debt in billions (and you have to understand that the debt is increasing FAST because of the burden of the increasing interest):
Beginning of 1980 – little over 1000 billion (1 Trillion)
1985 – 2075 billion
1990 – 4000 billion
1995 – 6000 billion
2000 – 7000 billion
2005 – 10,000 billion
2008 – 14,000 billion
2010 – 16,000 billion
The way this goes, it may probably reach 50,000 billion by 2020. Who knows?
Here is more of this news, courtesy of Martin Crutsinger, AP Economics Writer as published in Yahoo.
I am wondering now if there is still a way out for USA. What I know, as I have been there done that, unless you declare a bankruptcy and start over, you are done for. You will be a slave to interest payments for life, and eventually face the inevitable: bankruptcy!
Here are some specific details of the increase of gross public debt in billions (and you have to understand that the debt is increasing FAST because of the burden of the increasing interest):
Beginning of 1980 – little over 1000 billion (1 Trillion)
1985 – 2075 billion
1990 – 4000 billion
1995 – 6000 billion
2000 – 7000 billion
2005 – 10,000 billion
2008 – 14,000 billion
2010 – 16,000 billion
The way this goes, it may probably reach 50,000 billion by 2020. Who knows?
Here is more of this news, courtesy of Martin Crutsinger, AP Economics Writer as published in Yahoo.
Credit rating agency Standard & Poor's on Friday downgraded the United States' credit rating for the first time in the history of the ratings.
The credit rating agency said that it is cutting the country's top AAA rating by one notch to AA-plus. The credit agency said that it is making the move because the deficit reduction plan passed by Congress on Tuesday did not go far enough to stabilize the country's debt situation.
A source familiar with the discussions said that the Obama administration feels the S&P's analysis contained "deep and fundamental flaws."
S&P said that in addition to the downgrade, it is issuing a negative outlook, meaning that there was a chance it will lower the rating further within the next two years. It said such a downgrade to AA would occur if the agency sees less reductions in spending than Congress and the administration have agreed to make, higher interest rates or new fiscal pressures during this period.
S&P first put the government on notice in April that a downgrade was possible unless Congress and the administration came up with a credible long-term deficit reduction plan and avoided a default on the country's debt.
After months of wrangling and negotiations with the administration, Congress passed this week a debt reduction package at the 11th-hour that averted a possible default.
In its statement, S&P said that it had changed its view "of the difficulties of bridging the gulf between the political parties" over a credible deficit reduction plan.
S&P said it was now "pessimistic about the capacity of Congress and the administration to be able to leverage their agreement this week into a broader fiscal consolidation plan that stabilizes the government's debt dynamics anytime soon."