Congradulations Your Pay Has Been Cut

[Sunking]

Come Monday morning you will wake up in a new USA. Creditors lowered our credit rating a week ago last Friday, and the news finally broke out today on mas media. It is effective start of business Monday.

Yesterday the US government paid 12% of all tax revenues just to pay interest on our debt. Come Monday it jumps to as high as 30%. That means all federal programs, jobs, and entitlements will have across the board cuts.

To add to our joy, there is going to be a title wave of bond and T-Bill holders who bought the dollars the FED printed to cash them in which will drive down the value of the USD. That means everything you buy will go up in price because your money is not worth what it was today. It will really be high jumps on everything imported, no one want USD

To add to the fun any and all of your loan interest rates are going up raising your monthly payments. But the fun does not stop there as this is going to trigger a very deep recession, possibly a depression. That means a lot of you are going to loose your job in the coming months and will be unemployed for a very long time and loose everything.

Our government failed to make huge spending cuts, so now the bond and T-Bill holders will move in and take over and make those cuts for us. Obama is finished. Heck he may be the only POTUS who fails to win his own parties nomination for second term. We could very well get Billary Clinton as the Democrat nominee. What you wanna bet she resigns and runs?

[tropics solar]

Sunking, lets hope your citizens dont panic and sell up, but hold on to your bonds and T bills.
You are right you must control Govt spending and also controls USA peoples credit spending, dont buy so much on credit, take it easy, your dollar will eventually strenghen after all the USA is the worlds largest economy, everyone esle (europe) is basicly in the **** its only china who is holding huge amounts of USD and US debt, but even they dont want you to go under it would leave them in the **** as well.
the USA is in the position now i belive to crank up its exports and get out there and sell your products, as it is now much more affordable for every other nation to buy.
USA citizens buy your own products as well , keep your people working earning pay and producing for yourselfs and even better for export, that is why china is such a huge exporter they produce much cheaper products (they happen to be of poor quality so even better for US made products).
thats my New Zealand $1's worth

[Sunking]

Sunking, lets hope your citizens dont panic and sell up, but hold on to your bonds and T bills.

Well that is a problem because it is not US citizens or corporations holding those Bonds and T-Bills, it is foreign investors many of which intend to use them to harm the US economy. Just like the USA did to sink Russia in the 80's to bankrupt them. People have very short memories and refuse to read history even recent history.

You are right you must control Govt spending and also controls USA peoples credit spending, dont buy so much on credit,

There is another problem, our executive branch wants to spend even more money and go further into debt to fix the problem. To most that is insanity or a plan to bankrupt the country, take your pick. Only road block is Congress. The current spending bill has no plans to cut spending,

take it easy, your dollar will eventually strengthen after all the USA is the worlds largest economy,

Easier said than done. Our executive branch of government is clueless and has no intention on slowing down spending. Our first step is to grid lock them, freeze spending levels, and replace them in 2012.

I heard a good analogy today that puts things into perspective which most folks can wrap their brain around. It is to simply drop 8 decimal places in US government spending and revenues. Imagine this:

You earn $25,000 per year, but you spend $40,000 per year using credit cards to make up the difference. Your credit card bill right now is $150,000. So far our solution (last spending bill approved two weeks ago) cut yearly expenditures by $300, meaning you now spend $39,700 per year and just added another $14,700 on top of the $150,000 you owed, and no owe $164,700.

You do not have to be an accountant or finance banker to understand you are in deep trouble and should be filling bankruptcy. That is what S&P sees and the reason they lowered our credit rating. S&P was very nice to the USA, because they clearly could have easily rated our credit as junk status. If this was your personal financial status, you would loose everything and insolvent.

[muskrat]

hate to see this as a political forum but....

Sadly the way to exit a recession and build an economy is not to hunker down and stop spending. What works for an individual is a disaster for an economy as a whole.Wealth is created when people are working and producing goods not sitting on a pile of money.The corporations are flush now and the wealthiest part of our population is doing well also but all they are doing is sitting on a pile of cash and trying to wait out the bad times.The economy as a whole as well as the corporations would do better if there were massive tax increases
that were then spent on alternative energy products which reduce our dependency on oil.Whenever wealth becomes to concentrated at the top its like burning to rich a mixture in an engine;it stalls out.Same thing happens when every one gets the same thing regardless of how hard they work;no incentive to try harder.The government needs to spend more,mot from borrowed money but from increased taxes.

[muskrat]

hate to see this as a political forum but....

Sadly the way to exit a recession and build an economy is not to hunker down and stop spending. What works for an individual is a disaster for an economy as a whole.Wealth is created when people are working and producing goods not sitting on a pile of money.The corporations are flush now and the wealthiest part of our population is doing well also but all they are doing is sitting on a pile of cash and trying to wait out the bad times.The economy as a whole as well as the corporations would do better if there were massive tax increases
that were then spent on alternative energy products which reduce our dependency on oil.Whenever wealth becomes to concentrated at the top its like burning to rich a mixture in an engine;it stalls out.Same thing happens when every one gets the same thing regardless of how hard they work;no incentive to try harder.The government needs to spend more,not from borrowed money but from increased taxes.

[Sunking]

The government needs to spend more,mot from borrowed money but from increased taxes.

I rest my case. That is a sure fire plan for a deep depression

[Mike90250]

1) you are repeating yourself, about 5 minutes apart

2)

The government needs to spend more,not from borrowed money but from increased taxes.

and who is supposed to pay the tax, the serfs at the bottom of the pile ? GE that paid no tax ? Wealthy with all their loopholes ? Wait - mom & pop business will pay it !!

[meridiansolar]

"That means a lot of you are going to loose your job in the coming months and will be unemployed for a very long time and loose everything."

You'll probably loose your job too, not because of any political reasons, it's because you spend every five minutes ranting about political junk on a forum instead of working.

[KRenn]

Sadly the way to exit a recession and build an economy is not to hunker down and stop spending. .

You need to Google "Calvin Coolidge"


He got the US out of a major recession by reducing spending, reducing the tax burden on workers and staying within a budget, by
the end of his term, only 2% of the people in the country were paying a federal income tax. Common sense approach that seems
lost nowadays. Live within your means, keep spending reasonable, eliminate wasteful programs, make government more effective
and efficient.

[muskrat]

sorry about the double post

Sorry about the double post. I mistakenly thought I could correct a spelling error by re posting.Obviously I think any new taxes should be on those who are showing record profits now.I think returning tax rates to the same level they were at during our last booming economy under Bill Clinton would not act to slow the economy further.I don't want them to punishing just fair.There are many things the government should not be doing;that free enterprise does better.There are many things though that free enterprise will never do well because the benefits to society are widely distributed but the cost are to the individual.Example it is much cheaper to dump my untreated sewage in the river than pay to have it treated.I get no benefit for treating my sewage if no one else does but I still bear the cost. If everyone is required to treat their sewage however all share the cost but all benefit even more.I am not a fan of deficit spending.I do think we need to pay enough taxes to fund those things that government does well.If we are going to have a smaller government we need to make sure we also limit the size of businesses.The oil business requires investments of billions of dollars to build wells thousands of feet deep.If there are no businesses that need to borrow billions of dollars to operate there don't need to be banks that span the globe requiring thousands of inspectors and regulators.Ending the era of big oil will help reduce the need for big government.Local solar projects don't really require huge bureaucracies the way say a new oil refinery does.For those who think we are all going to hell in a hand basket please try to remember that the standard of living we enjoy now is for most people much higher today than it was back in "the good old days". As for those who are worried about how hard I am working I'd like them to know I make my money from real estate I have purchased and maintained in addition to having a full time job over the last thirty years.Thanks for the Calvin Coolidge reference I'll check that out.

[muskrat]

just checked out the Calvin Coolidge data

I just checked out the data on the Calvin Coolidge tax breaks.Indeed as the tax rates dropped the percentage of the tax burden payed by the rich indeed increased.Hmmm do the math a lower rate of taxes resulting in a higher percentage of taxes paid implies a much larger percentage of income was going to the wealthy.The argument would be much better if that particular era hadn't ended with the great depression.It was an era where large fortunes were made by borrowing on margin and depend on the fact that stocks always seemed to go up. We just got through an era when large fortunes were made on "derivatives" based housing prices always going up.There were phenomenal profits being made on insuring against losses on junk paper without any real assets to back the insurance.almost all of these profits were made because Standard and Poor (and others) rated bundles of bad mortgages AAA. This time the government stepped in and prevented a collapse into a second great depression partly by printing money.Why hasn't this caused huge amounts of inflation(yet)?Because all of those trillions of dollars in imaginary money had just disappeared from the economy when all those junk assets became worthless.Trillions of dollars disappear from investors pockets and reappear as government money without ever being paid as taxes.Hey we've invented the quantum tax hike!

[russ]

Any time you have MBA types playing with paper and selling it back and forth to each other while trying to screw the other guy you have a mess.

The entire market of derivatives is just gambling with the little guy at a very big disadvantage.

I see no reason at all for this 'creation of wealth' by paper shuffling.

The gold standard is not possible any more but what we have now is pure shyster.

[muskrat]

gold standard

the gold standard wouldn't have helped this situation even if it was practical.There have always been speculators that create ponzi like investments with no real backing.What we need is alert regulator who will take the punch bowl away before the manure hits the fan or at least an alert press that tells people they are buying hot air.

[russ]

There have always been speculators that create ponzi like investments with no real backing.What we need is alert regulator who will take the punch bowl away before the manure hits the fan or at least an alert press that tells people they are buying hot air.

The difference now? The MBA types have managed to convince the world these Ponzi schemes are legal.

When no one understands what is being traded or how much is being traded how does a watch dog or the press see through it.

[muskrat]

if no one can understand them

If trained regulator can't understand them then make them illegal they are obviously scams.