The credibility of Standard & Poor', Moody's, and Fitch Ratings are on the line

Discussion in 'Economics' started by SouthAmerica, Sep 18, 2008.

  1. .
    September 18, 2008

    SouthAmerica: Right now the credibility of the 3 major US financial credit rating agencies - Standard & Poor's, Moody's, and Fitch Ratings is on the line.

    Let’s see if these 3 world leading financial credit rating organizations - Standard & Poor's, Moody's, and Fitch Ratings will be doing their job in the near future when they start reviewing the real credit rating of the United States government because very soon the credit rating of the US government will achieve the status of just junk.

    And the US currency will become just confetti.

    Note: Things to be considered when reviewing the real credit rating of the US government:

    1) The current cumulative outstanding debt of the United States government.

    2) The massive amount of liabilities that are coming due related to the Baby Boom generation.

    3) The cost of foreign adventures in Iraq, Afghanistan, and God knows what else is in the pipeline.

    4) The massive amount of money related to nationalization of dying juggernauts such as Fannie and Freddie, AIG, and many others.

    5) And now the US government will absorb trillions of US dollars in toxic waste from banks and other financial institutions.

    Financial rating: US government = Junk


    Stocks surge on report of entity for bad debt
    Thursday September 18, 2008 - 4:08 pm ET
    By Tim Paradis, AP Business Writer
    Associated Press

    Stocks end sharply higher on report that government will create entity to hold banks' debt

    NEW YORK (AP) -- Wall Street has ended a volatile session sharply higher after a stunning late-session turnaround that sent the Dow Jones industrials up about 400 points. The big comeback followed a report that the federal government may create an entity that will take over banks' bad debt.

    The report on CNBC said Treasury Secretary Henry Paulson is considering the creation of an entity like the Resolution Trust Corp. that was set up during the savings and loan crisis of the late 1980s and early 1990s.

    Investors have been cheered by the notion of a huge federal intervention like the establishment of RTC to acquire the mortgage debt that has hobbled financial institutions and led to the intense volatility in the markets this week.

  2. Finally, some one who sees behind the window dressing. This potential move and the lowering of asset quality by the FED to qualify for FED discount window lending could collaspe the US Dollar. I would say by the least it goes back to 1.61 to the Euro.

    Makes for a strong Gold and Silver rally. Some got caught short the gold and silver investment vehicles(they where asleep at the wheel). Watch out covering over the last 2 days! Gold and Silver will go up from here. I do not trust any FIAT currencies at this point. Dollar goes down and all fiat currencies are on the brink of becoming invalied IOU's.

    Storm is brewing, hasn't got started yet.
  3. Excellent Commentary as Usual


    One may view this strictly on a comparative basis as well......

    Where would one go if the ratings were about the same to all other similar avenues.....

    To date ...the EURO ...has been the closest currency to a substitute , but they may suffer a similar fate.....

    Thus the size of various markets that seem to be of higher quality...can they be properly allocated to....

    ie some of the more desirable currencies do not have the float....etc...


    This is why I would like to see a true consolidated world wide exchange ....that would give one access to other Central Banks, foreign bonds, cds, stocks, the currency of one's a singular universal account....

    Should this not be a part of true globalization?

    By the way....the rating agencies no longer have credibility....

    Why should they ? They exist because of the lack of other choices....
  4. .
    September 18, 2008

    SouthAmerica: I should not be writing right now because I am very angry with the bullshit I heard on CNN from the politicians who just finished an emergency meeting in Washington D.C. about the current financial crisis.

    Those politicians in Washington D.C. are completely worthless and they are not worth even the food that they eat every day. What a bunch of idiots we have running this country today.

    To make things even worse as usual the US mainstream media is missing in action.

    Nobody (with the exception of maybe Lou Dobbs) is watching the store and trying to talk on behalf of the average middle class American person.

    If Americans had any understanding of what is happening right now they would be on the streets and they would be staging major demonstrations to stop the destruction of the last safety nets that we have here in the United States.

    Those idiots including Treasure Secretary Paulson came out of their emergency meeting and Paulson said that they were moving very fast to come up with some quick solutions to fix the current financial crisis.

    Let me translate to the American people in plain English what those bullshit artists are trying to do to the American people.

    After enriching themselves for many years beyond their wildest dreams these bullshit artist in Wall Street want to pass to the American taxpayer the toxic waste and massive losses that they created in financial markets (today the Financial Times – UK – had an article by Harvard University economics professor Kenneth Rogoff that estimates the current bailout could cost $ 1, or $ 2 trillion US dollars or even more because nobody really knows what kind of losses are in the pipeline related to losses in the Derivatives market - a market that is unregulated, out of sight and operating in automatic-pilot and also losses related to the sub-prime mess.)

    Now you ask me why the American people should be having major demonstrations all around the country to stop all this non-sense that is going on with taxpayer money?

    First we are at a point in American history that is not business as usual as they want people to believe. Some of these people mentioned the financial messes of the past like the Savings and Loans fiasco of the late 1980’s and the stock market crash of 1987, and so on….

    What is different at this time from any other financial crisis in the past?

    The United States government never had so much cumulative outstanding debt in the past as it is the case today - as of September 18, 2008 the cumulative debt of the US government is $ 9.7 trillion dollars.

    The US government is spending a fortune with the wars in Iraq and Afghanistan and a very reputable economist a Nobel Economics Prize winner Joseph Stiglitz wrote a book published in 2008 “The Three Trillion Dollar War” – on his book he gives an estimated cost of these wars. And nobody really knows what is going to be the total tab for these wars.

    The United States government has a ton of new liabilities coming due in the near future related to the Baby Boom generation that it is very conservatively estimated at over $ 50 trillion dollars.

    The US government already has assumed trillions of new liabilities when the government nationalized Fannie and Freddie and also bailout Bear Stearns and AIG and God knows which other corporations are going to be bailout in the near future.

    It is estimated that in the coming years the US government deficit spending is going to continue at a rate of over $ 500 billion dollars per year that will pile up on top the current cumulative outstanding debt of the US government.

    Every 2 years the United States will increase its cumulative debt by another $ 1 trillion dollars – that means the cumulative debt of the US government is going to grow very fast to $ 12 and $ 14 trillion dollars.

    Because of the level of outstanding debt of the US government very soon interest rate will increase in the US market to keep the US dollar from collapsing in world markets.

    And when that happens the amount of interest rate paid on an annual basis on the outstanding cumulative debt of the US government is going to explode and it is going to take larger and larger pieces of the annual budget of the US government.

    If the American people don’t wake up in time and start demonstrating around the country and ask the US government to stop this massive transfer of toxic waste and gambling losses from Wall Street to the lap of the taxpayers – then the net result is that as this massive amount of gambling losses are transferred to the US taxpayer the Wall Street bullshit artists besides laughing all the way to the bank they also are going to move on and create their next scam.

    And if the American people allows the US government to create this new toxic waste dump for Wall Street garbage to the tune of trillions of US dollars – then Americans deserve what is going to happen to them in the future when the US government starts cutting their Social security, Medicare, and Medicaid benefits to the bone.

    There is no two ways about it in a nutshell: Wall Street pass their gambling losses to the American taxpayer at the expense of major cuts in Social Security, Medicare, and Medicaid.

    If what Americans want is to go straight to the poor house then they are going to get their wishes very soon.

    Not a single person on the mainstream media has been able to connect the dots and have mentioned to the American people what is at stake with the shenanigans that is happening in Washington D.C. and Wall Street.

    It does not matter if you are a Republican or a Democrat you all have grandparents , or your parents, or even yourself to consider – the Bush administration is destroying the entire economic system of the United States and right now they are going to destroy indirectly the Social Security, Medicare, and Medicaid Systems. And that is going to affect the lives of every American in the coming years.

    If Americans do nothing at this time that will show to the world how Pathetic the American population has become and they deserve to lose every safety net that still available today.

    If Americans want to fight for their Social Security, Medicare, and Medicaid benefits the time is now and people should make a major effort to stop the US government from creating this graveyard to bury the massive gambling losses of Wall Street at taxpayers expense to the tune of trillions of dollars.

    If the American people don't fight back that just demonstrate how dumb, and stupid the American taxpayer has become.

  5. I do see the reasoning for the rating agencies to downgrade the US Government, but do you guys honestly think they'd have the balls to do something like that? Especially while knowing that it would drastically affect the world economies?
  6. .

    September 19, 2008

    SouthAmerica: As usual the US mainstream media is missing in action and they are not telling the American people what is behind the latest bailouts and the transfer of Wall Street gambling losses to the US taxpayer.

    They are indirectly dismantling right now the last safety nets of the American people and here is the explanation how they are doing that.

    The Democratic Party is in control of Congress at this historic moment and they should be held responsible for the complete destruction of Social Security, Medicare, and Medicaid that is underway under their watch right now.

    The Democratic Party is doing nothing right now to protect these social programs from the massive cuts that will result from this massive absorption of Wall Street gambling loses by the US government.

    Here are the actual indirect results of all these US government bailouts.

    Here is how they are going to finance this massive gambling losses from Wall Street:

    In a Nutshell:

    Taxpayer money will absorb trillions of gambling losses from Wall Street at the expense of major future cuts in social programs such as Social Security, Medicare, and Medicaid.

    There is no two ways about it – the American taxpayer is going to pay the gambling losses of Wall Street with massive cuts in social programs.

    You have to be a real idiot if you don’t understand what is really going on…

    The Bush administration with the help of the Democratic Party is in the process of dismantling all the major social programs in the United States.


    The biggest scam in American history is being sold out to the American people as a way to save Wall Street from its responsibilities – the responsibility of eat all these massive gambling losses.

    Brazzil magazine just published an article about the remarks that president Lula made yesterday regarding Pathetic Wall Street – basically Wall Street has become very quickly the laughing stock around the world – never mind the United States government.

    Brazzilmag - Friday, 19 September 2008
    “Brazilian President Makes Fun of Wall Street's Super Brains”

    Quoting from the article:

    “The President of Brazil, Luiz Inácio Lula da Silva said on Thursday, September 18, that he has watched with "sadness" the collapse of Wall Street firms that made economic policy recommendations in emerging markets "as if they were the super intelligent and we were the poor souls."

    "Important banks, very important banks, that spent their lives giving advice about Brazil and what we should or shouldn't do are now broke," news agency EFE quoted Lula da Silva as saying in a speech in southern Brazil.

    Lula criticized Wall Street firms for treating financial markets like a "casino" and for relying on "speculation" to make money. He said the Brazilian economy is well-equipped to weather the global crisis and would suffer "very little" even if the US sinks into a deep recession.

    Earlier in the week Argentina's Cristina Fernandez de Kirchner adopted a similar stance during a political rally. "While the First World collapses" because of the international crisis, Argentina remains "firm," she said.

    "The First World, to which we had been repeatedly told we must reach, is crumbling like a bubble", Kirchner added. "In the midst of the swelling sea" Argentina remains strong. "It's time many of those institutions instead of telling us what to do, should look around and do something for themselves".


    SouthAmerica: Today about 45 percent of Brazzil magazine readers are from China and another 10 percent are from other Asian countries.

    I posted on Brazzil magazine the information that I posted on this thread plus the following.

    By the way, Brazilians and the rest of the world deserve to be taken for a ride if they continue sending all their savings to the United States for safety.

    You have to be very stupid to think that the US government represents safety today when in reality its financial position is becoming close to JUNK status.

    If you continue sending your money to invest in US government securities you are just gambling your money away and you deserve to lose it all.

    Americans are glad that the world is full of suckers, stupid and naïve people and they should not cry when their money goes up in smoke.


    You can read all this information also at the PBS website - Washington Week TV program.

  7. purple


    If our government had any control over itself, it would give credit to the mess where it is do. The Federal Reserve is;
    * Rothschild Banks of London and Berlin (Rothschild and world economy)
    * Lazard Brothers Bank of Paris
    * Israel Moses Sieff Banks of Italy
    * Warburg Bank of Hamburg, Germany and Amsterdam
    * Kuhn Loeb Bank of New York
    * Lehman Brothers Bank of New York
    * Goldman Sachs Bank of New York
    * Chase Manhattan Bank of New York (Controlled By the Rockefeller Family Tree)
    They made the mess and they are responsible for it. Let them settle the debt.
    We need to go back to the gold standard and print our own money backed by such. Kick the fed out of the United States. We dont control them they control you. We need our own currency and no more of their fiat money. The Constitution says only gold and silver will be money in the United States. Article2 Section 10. Our money has been junk and all that think this situation will get better are full of dun.
    How long will you continue to trade debt with people who write the rules as they go. Will you be one of the ones that cant quit the habit of being used.
  8. vv111y


    They have no credibility.

    Well, except for false negatives - if they give a poor rating, then that has information.

    They are rife with false positives.
  9. Avi 8

    Avi 8

    Article 1.