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BLITZER’S BLOG: Horrendous day on Wall Street
By CNN's Wolf Blitzer
(CNN) - When President Barack Obama started speaking at the White House at 1:52 p.m. today, the Dow Jones was down around 400 points. When he wrapped up 10 minutes later, it was down around 430 points. And when the market closed at 4 p.m., the Dow was down 635 points for the day – a drop of more than 5.6%. The tech-heavy Nasdaq index was down nearly 6.9% for the day. The S&P 500 was down 6.7%. In short, it was a horrendous day on Wall Street – as it was earlier in Europe and Asia.
It’s certainly not fair to blame only the president for this awful downslide. There are limits to what he can do in the current economic and political climate. There is plenty of blame to go around – including to congressional Democrats and Republicans, liberals and conservatives.
But it’s also clear that Obama and his top advisers are focusing much more aggressively now on steps he might be able to take to try to turn things around. In his remarks today, he said he would soon be coming up with new recommendations for the proposed congressional super committee of 12 members who are supposed to come up with new deficit reduction plans. The president said they should include increased tax revenue – meaning higher taxes on the wealthy – and “modest adjustments” to Medicare. Conservatives won’t like higher taxes; liberals won’t like Medicare cuts.
By the way, it wasn’t just Standard & Poor’s downgrading of the U.S. credit rating from AAA to AA+ that caused today’s market collapse. The markets have been falling steadily and ominously for two weeks. Investors in the United States and around the world have lost trillions of dollars in equity. Their portfolios have suffered big time, and no one can say when this slide will stop.
RELATED STORY: Dow plunges after S&P downgrade
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Post by: Filed under: Economy • President Obama • Stock Market • Wolf Blitzer |
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Wolf,
Obama wanted a "clean" debt ceiling bill just a few months ago. His lack of understanding of our economic problems and lack of leadership causes fear and uncertainty in the markets. Thank God for the conservatives in the House who helped avert a much worse market reaction.
Defense cuts are OK, we need to stop fighting other people's wars. But no cuts to medicare, people funded the system with their paychecks, throughout a life! it's indecent that when you become old and cannot work anymore and need care, the gov is saying I'm sorry but I need your doctor's money to pay a drug lord in Afganistan, or a corrupt officer or oil companies. That should be stopped!
with obama in command, I suggest all Americans start stock piling Food and Ammo.
You know who is most to blame?
We are.
We continue to allow this broken two-party system to hijack all operations, we allow our officials to support broken financial systems that first caused this whole debacle with erroreous ratings and lack of banking regulations, then we let the same institutions drag us down even further. We are left with extremists on the right and extremists on the left, and anyone that dares to compromise or take a middle of the road approach is viewed as weak.
We need a reasonable, middle ground third party option. (and I don't mean more splinter groups that are even more extreme than the two parties.)
You'd have at least my vote, and I'd wager many more.
Mr Blitzer needs to be more like the great Peter Arnet !
Ask real questions , get real answers . Ask how much two wars cost this country, And the long-term economic consequences of long-term wars. Blitzer didn't ask them then , and he wont ask them now.
It's very easy to be a paper punching desk jockey.
"Those who do not remember history are condemned to repeat it"
I hope America understands how damaging the "grass-roots" Tea Party can be to our country. When the Koch brothers were paying people to hand-paint signs to look like they were written by "good common folks" we should have smelled a rat. This damage was done by well orchestrated terrorism committed by right-wing radicals. The Kochs (and others in the group) have enough money to be insulated from the crash of our economy and their facist agenda is well served by the chaos. The middle-class of America either understands the wake-up call or gets trampled by the wealthy elitists in a losing battle of class warfare. Thank the Tea party for our 2nd world status!
Will this day on Wall Street be called a "correction", like they initially labeled the last crash?
"There is plenty of blame to go around – including to congressional Democrats and Republicans, liberals and conservatives."
Wolf – thanks for calling out everyone, I constantly argue against the partisan name calling as it is a distraction and is used as such, the left and right blame each other and then pass whatever piece of garbage they want while the citizens are arguing with each other.
Stop the partisan games – formal political parties should be illegal!
Corporate greed is the problem...The new motto is let's do more with less! ok that means cut wages, cut the amount of hours you're allowed to work, even wal-mart now only wants their full time employees to get 35 hours per week, same amount of work for less money, and walmart is not hurting for money, it's greed baby, greed!
Whatever you do, PANIC!!!! SELL!!!! It will help the economy
........There's a feeling here that S & P playing politics in favor of the rich............stocks go low and the rich buys them up, I think they should be under investigation................
You go for that cut,cap stuff when you have reduced the national debt to =0=. Otherwise, the national debt will still be there when the year 2300 rolls around. If the debt is that important, then raise taxes to get it paid off like that Republican president didn't do when he went to war.
Democrats are blaming the Tea Party for today’s uncompromising environment in Washington, but Obama really started the current extreme polarization trend when he and Pelosi forced Obamacare through congress against the will of the people. That set the tone and has created an escalating ever more-rigid attitude on both sides. He created the Tea Party through his arrogance and liberal policies. It’ll be hard to get back to more reasonable voting as long as he’s in the driver’s seat.
The Dow would have to go down another 4000 points tomorrow to lose as much as this moron did on Jeopardy. This moron has ZERO credibility- How does WOLF BLITZER still have a job? I won't even read anything he hires someone to write– since he's not smart enough to write a sentence.
If Wolf did not work for CNN he would be the new jerry springer
Under our revised base case
fiscal scenario–which we consider to be consistent with a 'AA+' long-term
rating and a negative outlook–we now project that net general government debt
would rise from an estimated 74% of GDP by the end of 2011 to 79% in 2015 and
85% by 2021. Even the projected 2015 ratio of sovereign indebtedness is high
in relation to those of peer credits and, as noted, would continue to rise
under the act's revised policy settings.
Compared with previous projections, our revised base case scenario now
assumes that the 2001 and 2003 tax cuts, due to expire by the end of 2012,
remain in place. We have changed our assumption on this because the majority
of Republicans in Congress continue to resist any measure that would raise
revenues, a position we believe Congress reinforced by passing the act. Key
God has granted me the serenity to accept the things I cannot change. The sun still shines,my wife is still o.k.,my friends are still smiling and the beer is still cold.
Sometimes numbers on a screen don't mean jack.
Well here we are again.. the Stock Market has had many corrections in the past, 1929, Black this, Terrible Tuesday
on and on....the Stock Market is like a Bellow.. and that machine was sucking in so much cash, it had to Blow its
Wad...now its time to stand in front of that Bellow with some fresh cash and let it suck and suck and suck until that
bag blow's it Wab again after about 15% to 25% gains for the next couple of years, so the suck job goes on and on.
Tea Party 1: America: 0
Last week some analysts said that the S&P downgrade was already priced in, into the market. Again, this was last week. After today's carnage, I am now looking for the names and addresses of those analysts...
Our only salvation will come when the super 12 deadlock and "mandatory" cuts are imposed on defense and medicare budgets. You can't have it both ways.
Let's stop playing the blame game and fix it. Congress, Mr. President stop pointing fingers and figure out how to put it right.
My friends and I (one of which is an officer who served two tours of duty in Afganistan and Iraq) absolutely cannot understand. WHY is everyone blaming Obama for this? He clearly inherited two wars, AND a collapsed economy from the previous administration. He has had to deal with Republicans and Tea Partiers who absolutely won't compromise on adding additional taxes – even though the Democrats offered up substantial cuts to goverment – to help reduce debt. But yet a group of nitwits either wants to "fire them all (across the board)" or "blame Obama". Seriously – are you guys nuts?
It gets down to a lack of Leadership for both parties. The writing was on the wall and still they could not act. They stalled and dillydallied, knowing full well they were creating and worsening the problem. Even now, have you seen a clear, specific, national plan to turn it around, other than focusing on impoverishing Americans who have been sacrificing the last ten years? Clearly, we can no longer afford the nation building and wars in the Middle East, however much some folks like them. The teabaggers have achieved their objective...but at what cost to the country!
We need to call congress back and get a jobs bill passed. Without jobs this country can't recover from this depression
(recession) The time for play party politics is over.
NOW IS THE TIME TO BE AN AMERICAN FIRST!
Hello from your cousins in the Cool Blue North.
Don't panic, we have been down this road. If everything is the problem, then address everything in the solution.
Yes, higher taxes. Yes, spending cuts pro rata across the board. Yes, times will be tough. Yes, you will get through it, as we did to where we now have AAA and continuing. Keep Obama, keep Boehner, but don't listen to anyone who tells you that it has to be THIS way and only this way.
Suck it up, and get back to being our strong 'Merican neighbors.
(on the side, can you also lose Jersey Shore? Sheesh....) John in Canada.
We are about to learn the hard way that an economy built on political gifts, defense spending, banking, healthcare and financial services is an economy built on quicksand. There is no beef all of these sectors rest in and around underlying value which we have chosen to give to China.
I heard Wolf and CNN talking heads all saying, "Europe is far worse."
Western Europe per capita owes less than the US, its infrastructure is modern (Ultra high speed trains, super highways, etc.) and it still manufactures.
The US infrastructure is medieval and falling apart, plus its factories are in China and Mexico.
The seriousness of the problem was clear long ago. We have been suffering major trade deficits since the turn of the century. We have also reduced our income stream as a country ( tax cuts), we bailed out the financial markets ( they have not reciprocated with their creditors), and the rich keep hoarding their wealth and calling themselves job creators. We have nothing to offer to make a profit in this coutnry, and with no real enemies to fight our reliance on the sales of defense weapontry is failing.
We need to create a new indusrty that the world needs and keep it stateside for once, not export it like we do everything else
Wolf Blitzer is sexy. Just had to say that.
This is what happens when politicians put party before country. Our representative government - all of them - are failing us.
In the next election we need a complete change. It doesn't matter if you're left or right; just vote for anyone but the incumbents.
Republicans all went short on the dollar, stocks, and America....and are all now snickering and counting their money.
This downgrade was NOT brought about by the tea party! It was brought about by every administration that has increased out national debt, and has not implemented ways to pare it down. It is the Republicans who want to get rid of this horrendous debt, therefore they are not the ones to blame. The Democrats are just looking for someone else to blame, when in actuality, they are partly to blame themselves!
I really can't figure out why anyone is surprised? Congress is a mess. The GOP is worthless & the Democrats are sliding the same way. They should ALL be ashamed!! Acting like spoiled brats that don't get their way while a Nation is depending on them.
It is past time for term limits for Congress. It is time they learn to live and scrape like the American People they claim to represent do! Its time they purchase their own health care just like we do. Let them be a part of Social Security & Medicare!
Bet that once that happens they will straighten this whole thing out QUICK!
How's all that HOPE and CHANGE working out for you?
If the big-wigs on Wall Street thought today was ugly, wait until Congress sees what happens to Pennsylvania Avenue.
I bet if he had said that he was selling Freddie and Fannie to the Fed, the slide would have stopped. If he had said he would veto any extension of the Bush Tax cuts unless there was a compromise, the slide would have stopped. Saying neither one gave no comfort to the economy.
The plain truth is that the politicians in each of the two parties hate each other. So they behave as brats. They know that the electorate will not rise up in sufficient numbers to oust them so they continue on their destructive paths regardless of who gets hurt in collateral damage.
Please do a story to help us Joe average folks understand how this week will affect our home town banks. My husband and I are trying to refinance our variable rate mortgage, and now that may not be possible. He is a retired 71 year old teacher, looking for work again, and can't find ANY job. Now our retirement is decimated. I suspect we are Everyman.
Clearly, Obama and Democrats are desperate to blame the S&P downgrade and the market drop on anyone other than themselves. Trying to blame it on the TEA party is laughable, as only the TEA Party has gotten the Democrats to focus on cutting. The problem was Obama and Democrats refused to cut as much as S&P wanted to see cut to get us on sound footing. So this downgrade, and all it's consequences are the fault of Obama, Democrats and their liberal allies, who want nothing but continued out-of-control spending.
I'm just wondering how much yelling at each other is enough? Spending cuts vs. increased spending vs. unemployment vs. plummeting markets blah blah blah. Hasn't AT LEAST one, a single one of you out there on either side of the political aisle wondered why we expect an exponentially growing system (our economy) to be sustainable? Can anyone name a sustainable exponential process in nature?
Look up "the Law of 70," it tells you how fast an exponentially growing system will double in size. What is a healthy growth rate for the U.S. economy? 3 percent? Do we really expect, with our leveling off population, that our economy will double in size in roughly 24 years? The metric is wrong, the model is wrong, and until we learn to think completely outside of the box then we are doomed to keep experiencing these boom / bust cycles...
For all those suggesting we raise taxes, I hope that means on all citizens, specifically the 51% or so that pay no federal taxes. Everyone has to have skin in the game. We can still have a progressive tax, but it should be on all, not just on a few.
We could solve this issue in 24 hours. Everyone should turn over all earnings, wage and investment, to Barack Hussien Obama and he can keep what he needs and return what he thinks we citizens deserve. This is kinda what CNN has been promoting over the last three years. Worship Obama, worship his holy name.
I dont know why people are insisting hardworking people who work 80-90 hrs a week and making more than 250K to pay more taxes than the average Joe! Why should I pay more taxes and thus be penalized than the people who dont make more. I would say to other study and work hard rather than stating rich have to pay more! I do not agree with Obama when he clumps himself with this group stating, "People like me (PresidenT) do not need tax breaks", I would say Mr President speak for yourself and this is the reason you will not get my vote this time around.
This is all very scary !! Thank God I ran to Bank of America CD's and am getting .5% interest on my money after Lehman Brothers wiped me out !! OH WAIT !! Bank of America ??? I think I am in trouble again!
Glad I didn't sell the farm, at least I can grow a garden, get a wood stove and use my Masters Degree to start the fire.
Two simple facts:
A true market loss occurs when a LOT of people sell lower than they buy . When that happens, those that lost money in the market get what they deserve. Markets rise artificially high when people pay more for something than it is worth. When people pay more than they should, they get what they deserve.
Washington DC is not a synonym for congress.
I suspect that those who don't understand the later are the same people who don't understand the former. It might be helpful if the media didn't contribute to the problem.
The question isn't "what happened?" The question is "how do we make it better?" Maybe thoughtful words, a little education, and a willingness to be accountable for individual decision making might be where we should start.
Obama should stop campaigning and fundraising. If he wants to be re-elected, fix the mess. He'll get the votes with the results. He only needs to campaign in hopes to convince the masses that the failures during his presidency are someone else's fault.
How about divorcing our futures from wall street and dc? Why do we allow two cities and small circle of people to run this country? Why do we even talk about what CNN wants us to talk about? We need to think beyond the parameters of what the MSM talks about. And I mean fundamental stuff about the dollar- about the Federal Reserve and its unaccountable power- and the nature of power between the states the federal government and corporations. What we are seeing now- is the death of Crony Capitalism. And to keep listening to poeple like Wolf Blitzer and their distraction BS is pointless at this point. Blitzer crawls on his belly before power- that is who he represents and works for. The poeple who brought us to this point- is who Wolf Blitzer works for and who he cares about.
A New Sheriff in town, S&P Rating and their second major miscall!
Despite being a miscall and seemingly a vendetta, in an counterintuitive way, the S&P downgrade maybe the BEST thing that happened to the US economy!Solute to the capitalism as it will not allow the postponement of the inevitable needed cleansing indefinitely! It seems we all want the creative part of Schumpeter's “Creative Destruction” but not the destruction part as it involves peoples' well-being. No matter how hard policy makers have tried to artificially postpone the inevitable wringing out the excess out of the system (delaying housing foreclosures and bankruptcies, bailing out poorly managed companies and banks, excessive consumer and Govt borrowing, etc.), in a laissez-faire attempt to correct itself, the market will eventually finds a way to strike back. Welcome a new Sheriff in town, the S&P rating agency.
Who is in charge here? Judging from their recent performances, there is a credibility gap and a lack of confidence in all so called leaders in this country from the President and his unfulfilled promises, to the Congress and their political budget circus, to the Fed and their QEs' bailout of their Wall Street friends, to the Treasury money laundering and monetization of the debt, to the completely exhausted monetary and fiscal policies, etc.). In this environment of uncertainty and lack of leadership, a new leader arrives. Now a relatively unknown, unelected, unaccountable group of rating decision makers, themselves with a poor performance record and a major miss-judgment that facilitated the first leg of the great recession, are leading the economy toward the anticipated double-dip recession. What else did you expect? Here it comes....
Had I not pulled out all my cash 3 months ago...I'd have lost almost 30k today. Good thing I didn't listen to all those anal ysts who said "don't worry...if you have time just leave your stocks alone".
I hope the Teaabaun is happy. They have screwed up the hold dam economy. Sense they don't have IRA's and buy lottery tickets for retirment they should be elated.
All those expensive WMD Freedom Fries are high in saturated fat , thats a three trillion dollar case of long-term heart burn !
Thanks GWB !
There goes my 401K retirement savings...no thanks to the Tea Party hobbits.
Our nation is in serious trouble.
Both parties have a part in the blame for the debt and deficits . Both parties are equally guilty of the gridlock climate in Washington. Obama and the Democrats blame Republicans and the Tea Party for everything. Republicans blame Obama and the Democrats for everything. Democrats will not touch the biggest drivers of the debt, Social Security and Medicare and won't cut spending unless you hold the debt ceiling over their head. Republicans won't raise taxes.
We need solutions. It is said Obama and Boehner were close to a deal that included 800 billion in increased revenue through tax reform and Obama had agreed to changes to Medicare and Social Security. Democrats were furious with Obama for compromising on Medicare and Social Security and the deal blew up when Obama asked for 400 billion more than the already agreed on 800 billion in revenue increase. I think we need to return to this deal for the final solution.
Out side of the Boehner/Obama deal that fell through, the only bills that have been written and passed that would have reduced the deficits enough to avoid a downgrade were Republican bills. They were killed by the Democrats in the Senate and Obama said he would veto them if passed.
In the close to 3 years since Obama became President, Democrats have not even tried to pass a bill that would have satisfied the S & P. Democrats only agreed to cut any spending at all to avoid a default. They really wanted a clean debt ceiling bill with no deficit reduction. The last budget the Democrats had the guts to pass was scored by the CBO with nearly a trillion dollar annual deficits for the next 10 years. This was the final spark that set of the Tea Party. Democrats have not passed a budget since because they want to hid from the public that it would be no better than the last one they passed. Democrats have called for tax increases, but the tax increases they have asked for amount to less then 1 trillion over the next 10 years. A lot of money, but not even close to enough to have avoided the S & P down grade.
All Americans should be thanking the Tea Party for FORCING congress and Obama to actually begin deficit reduction.
So far only Republicans have actually put forward detailed plans that would actually solve the problem. These plans are not supported by Democrats. Time the Democrats to actually come up with a detailed solution of their own. Once the Democrats have a plan, the two parties could work on a compromise. Perhaps one similar to the Boehner/Obama one that close to a deal. The truth is I do not think there is any plan the Democrats can stomach. They really want to increase spending and government and don't care about the deficits. This whole deficit reduction thing gets in the way of all the new government they want to create. I hope I am wrong on that point. If Democrats would really support a deal similar to what Boehner and Obama were close on, this problem could actually get solved.
The largest credit reporting agency downgarding the US first time ever. Is only because Obama is the first President to spend over $4 billion per day. More than double Bush at $1.6 billion & more than eight times Clinton at $400 million.
How can you improve the economy when America no longer manufactures anything? You cannot purchase a computer, cellphone, television, fax machine, mp3 player or dvd player that is made in America. People wait in line to purchase the latest iPad, iPhone, or Ipod and they are all made in China. There are now ten Tablets on the market to compete with the iPad and all of them are manufactured outside the U.S.. You cannot purchase mens socks, underwear, shirts and slacks that are made in America. Go to a Home Depot and you will find washers, dryers, and refrigerators from China and South Korea.
It seems that other than the food we eat and jet planes nothing is made in this country any longer and a country that no longer manufactures anything is a country that will continue its steep decline.
Exactly the point. However we continue to be told that "free trade agreements" are good and that there is nothing wrong with rewarding corporations with tax breaks to take jobs overseas is a good idea, and taxing them is a bad idea even though they have trillions in the bank and are effectively taxed at the lowest rates in decades, and all we really need to due is lower our wages and get rid of unions and somehpw it will get better.
We won't even put "buy American" clauses in spending bills because we are worried that the Chineese will get upset. We look at a front runner who made billions moving jobs overseas and tering apart American companies and somehow think he is going to good on jobs. He most likely will, do good for China and other third world countries.
We have a president who just seems to have forgotten about jobs in America as he moved to every other topic on the agenda of every special interest group and forgot to even put unemployment extension n the current debt bill.
On the face of it, your reasoning is sound. But there is a potential cure for the export of American jobs. Example, assume Amana makes a widget for its washer that costs Amana $100 to make. Suppose that it discovers that the same widget can be made in Asia for $90. Given the thousands of washers Amana makes and sells, this is a no brainer. Aman would close its Widget operation putting 1000 people out of work. right?
But say that Amana was to tell the 1000 employees that if they could make the widget for $85 each, and at the same quality as the Asian firm, further, Amana would sell the equipment in place plus the building the widget is made in to the employee group at favorable terms, what would those employees do? My take would be that the employees would form an ESOP, convince Amana that they could deliver widgets at $85 each and then do whatever it took to make it work. An Illnois firm named Springfield Remanufacturing did exactly that and they are still in business after 24 years of operation.
Why cannot we do the same today?
Wrong! Even most of the produce sold in this country is grown in other countries! A large percentage of the meat that is consumed by U.S. families is raised outside the U.S. We couldn't even feed ourselves if we had to. NOT ENOUGH TO GO AROUND and SUBSIDIZING FARMERS AND RANCHERS NOT TO PRODUCE ANY MORE!
You are forgetting two of the most important "products" that we generate – innovation and discovery. The US has been the clear world leader in these areas but with so much investment in the military industrial complex, we are slowly sliding down the slope. Two steps in the right direction would be to shift more money to stimulate and facilitate discovery/innovation and to make sure these advances STAY HOME. As goes outsourcing, so goes the intellectual property. If we do not do these things, we truly will have almost nothing left.
We can make items here in the U.S. Just prepare to pay more money for them. Consumers can't have cheap goods AND "made in the U.S.A."
Yeah.... and the food here is not even safe with all the salmonella... unless you buy organics, which is expensive.
I'm a city girl, but I'd like to have my own farm and livestock.
Why don't you start a socks manufacturing business in America? We'll see how competitive your prices will be.
I don't think there is much of a way for us to fix this trade imbalance. There are 1.4 billion Chinese, most of which are willing to earn 1/8th what American's earn. In fact 1/8th of what we earn would be considered wealthy to them. It is becoming more and more a world market. Scary thing is, Chinese students understand the importance of a good education, and they are studying HARD. Those kids over there DO NOT take their education for granted. China will be the next economic super-power ... there's not much we can do about that. We can however TRY to fix our federal government debt situation by cutting the CR@P out of what our government spends.
Exactly on point Mark. Ever since the Free Trade agreements started popping up our economy has been on a steep decline. Only reason it has taking so long to see is the IT and .COM booms. But now those are are pretty stagnant we are noticing hte decline in everything else.
WOW
WOW WOW!!
yes thats true... there is a site called 'madeinusaforever' dot com. That lists US only made goods. (I have no affiliation with this whatsoever, but sometimes I buy there).
Yes, start reading the labels. We were warned of this for decades, and people ignored the warnings. Businessmen made fortunes selling us all out and offshoring... this is what we get.
We manufactured the Tea Party. That negates any income from what we do actually make.
You are correct, as americans we are over-weight, under-educated, and uninformed consumers. Unless we start producing something, anything the rest of the world wants, our country will collapse.
Mark, you hit the nail dead on. If we as Americans think that we can survive for much longer by having everything manufactured off shore, we are living in a fantasy world. The large corportations will have us belive that they are doing share holders a favour by laying workers off and transfering jobs offshore. Well guess again, there seems to be a direct corelation with record profits and lay off's. Corporate America's new tag line is- "perserving tomorrow, today", meaning we just profited over a billion this quarter alone, but we're still laying off 15% of the global workforce. As Americans we think that by investing in the stock market we are all going to retire early and worry free. When are we going to realize that will never happen- it's just a fantasy. Corporate America and Wall street never has and never will have the best interest of the average American in mind. When the presidents of corporations say- we want to maximize share holder value. The only thing our company president did was maxime his and his cronies values by giving himself a 100% salary increase, from 9 to 18 million dollars a year, yet the top perferming employee only received a meger 1.5% increase. I was told that these people "the presidents of the multi-nationals"commend that kind of money because of the hard decseions they have to make in order sustatain an organization. Any dumy, even a monkey can come in and slash a workforce, only to redistribute the same amount of work to the remaining people. A real leader would minimize the casualties of layoffds and seek out different ways of sustaining the organization.
We have to stop fueling Corporate America through open market purchases- We as supportors of the Capital markets are fueling our own demise.
This is probably the most brilliant post I've read in years. Impose heavy tarrifs on imported goods, issue tax breaks to those willing to begin manufacturing consumer goods built domestically. People working there will be employed, creating a broader tax base, those same people will purchase other goods also manufactured domestically. We used to do that. And we used to do it well.
What you just mentioned has nothing to do with politics, but rather the actual underlying issue. You are right on my friend. People keep yapping about "jobs, jobs jobs." go start a business, find some ambition and do something! cuz the jobs aint comin back.
signed: an employed salesman
My question is more about why the media doesn’t make it clear where how these ratings agencies are funded. They are spin offs of the multinational corporations and are funded by those they rate, with the exception of the governments. Has the term “conflict of interest” ever been uttered in the media about this relationship?
Now, let’s see why they might want the ratings to drop – think it may have something to do with the republican’s efforts to destroy the Obama presidency? Why could they give Junk Bonds and sub-prime mortgages AAA ratings, leading directly to the recession (and directly to unbelievable income for the Wall Streeters and the Bankers) and have any credibility to judge anything. How much money did S&P make off the financial instruments that they stated were GREAT investments?
Why does the media not report the sentence on page four for the report that specifically identifies the republicans and the cause for the downgrade and mentions not at all the administration or democrats as responsible? Is it because the Media is almost wholly owned by republican backers and corporations?
The Tea Baggers should have known this was coming; they were told and over again, but they continued to blindly rush toward the edge. And the administration gave in rather than force the issue by using a constitutional remedy and forcing the Court to rule on the clear statement that the debt of the country must be paid and if the debt ceiling law is in fact constitutional when the congress and specifically the house originates spending and therefore are in fact responsible for the spending.
How did they allowed Bush to keep these wars off the books without an outcry about the debt he was generating is one question. Another might well be what happened to all those pallets of $100.00 bills that have gone missing in Iraq – we could use that money now to pay down the debt – or maybe payoff S&P for a better credit rating – I know they would take the money!
WOW did you really say "Why could they give Junk Bonds and sub-prime mortgages AAA ratings"? Junk bonds are junk bonds because they do not have AAA ratings in fact they have ratings so bad they get junk status. The same goes for sub-prime mortgages.
And to make matters worse the rich, money changers are going to make MORE money now that interest rates will probably go up across the board on everything from credit cards to car loans. They actually may have had an incentive to drop our credit rating. It's a win-win for them and evidently they don't care if they bring our nation down. The Republicans are definitely doing their bidding and it seems like the Democrats are the biggest wimps on Earth. This country is quickly becoming an oligarchy. Our founding fathers fought a monarchy to free us just so that we could allow ourselves to be taken over again by rich multinational corporations and individuals who could care less about anyone is the United States as long as they continue to suck in all the wealth. At some point we are going to have to begin to fight back against the Tea Party and more extreme Republicans by not spending our money in their districts and states and by not continuing to sink all our money into their investment schemes in the hopes that they will allow us to retire someday and still eat food and sleep in a bed in a house or apartment somewhere. Voting for politicians who are not in the pockets of the wealthy and who have some courage would help too. Democrats need to step up to the plate and stop worrying about hurting the Republicans feelings. They don't want to compromise.
The media has, and always will be, slanted toward the left. This excludes Fox News, of course, which is fully on the right and a little whacked out! It all makes for great theatre!
the media if 97 % for the liberals....i dont care for extreme from either side....i am an american and wish we could have a govt serving the middle line that takes care of americans
I understand your sentiments and sympathize, but even though our system appears broken at the moment, and it may be seriously broken, getting the judiciary involved in taxation issues is one thing I am very glad Obama has not done. For better or for worse, Congress should control the purse strings, even at the cost of paralysis like you see here. The larger issue is the usage of the filibuster and stonewall tactics, which can only be remedied one way: vote 'em out.
The S&P downgrade hit a nerve; the self-esteem of the USA. Everyone is in a panic. We need to
be calm and carry on with business. The entire downgrade was brought on by the Tea Party.
We need to get them voted OUT. To President Obama's credit, I believe he is doing the best
he can in such an ugly political climate. This political climate is hurting the USA. Wake up America
before it's too late. Today Senior citizens watched their savings disappear. What happens when they
need that money to help them get through the difficult years, brought on by illness and old age?
Medicare? Ha, they plan to cut that too. God Help us all! We need a Clinton in the White House;
and it can come soon enough. Run Hillary Run!!
Yes,
This conservative agrees, but as far Hillary running, unfortunately she too easy a target for the pesudo-conservatives.
And P.S. to you Tea Partiers' Obama is no socialist.
Even I know that! I am 64 years old and have seen the face of true communist and socialist and he is no where close!
Donna, you must learn basic math. Tax the rich 100% and that still does not solve the deficit problem. Cuts are coming no matter what. The only way out of this is to grow our way out of it, but we are competing with the "wild west" economies out there that have no unions, no regulations, no EPA AND no effective tax collection. Lower taxes and less regulations are the simple answer to help us compete. I'm open to other ideas. Anyone?
Donna... what an original idea, "it was the tea party's fault"
Sorry... your ignorance is showing. IF the tea party had been stronger, this market turmoil would NOT HAVE HAPPENED. Reason: they are the only ones who are serious about tackling the problem of debt and the entitlement mentality. The rest of washington is too busy trying to buy votes with other people's money AND THAT IS WHY S & P downgraded our credit worthiness.
Donna – The credit downgrade is a sign that investors are starting to think that we are so far in debt that it can't be paid off. The Republicans see this and ask for spending cuts yet Obama continues to seek to spend more than we have. How then is the Left not fully responsible for this mess?
You are one more stupid person,. The downgrade was caused by Obama himself. First it was his job to prepare his administration's budget present it to Congress for the House to modify and seNd to the Senate. The same procedure would then be theirs to either pass modify or send back to the house until finally approved by both Houses. Obama did not do his job as usual but did come on TV several times to plain tell the S & P to downgrade us,. The Tea Party is not strong enough yet to have an effect moron. But I'll be glad when they do. In the mentime if you yell like you plan then you get the results called for. Obama working under George Soros this was their plan to downgrade the U.S. just like Soros did to Great Britian, destroyed the Balkans and divided the Chezch governmet. Attacked the Soviet Union until they had to go back to just being Russia while their provinces took on Statehood. He donated 2 billion dollars to the Democrat party to see to it Obama was their Canindate. If you imbeciles can not read beyween the lines with Obama himself telling you he hates America it doesn't take a Rocket Scientist to figure out their plan and they have succeeded in bringing the Eagle trembling to her knees like Nostradamus predicted. He said a false rophet will come from the Islands to rise to the highest position in the land. That the Eagle would soon fall trembling to her knees but the false prophet would be discovered and would run to the middle east to take his proper place as leader of the Arab world to conquer Europe and bring about the downfall of the CATHOLIC CHURCH BEFORE THE BEAR(RUSSIA , FRENCH WOULD JOIN FORCES WITH THE EAGLE LED BY THE PRINCESS(PALIN) TO TURN HIM BACK). THIS IS PROPHECY AND ALSO FITS REVELATIONS. HE WILL BE DESTROYED. OUR FALSE PROPHET HAS ARRIVED AND SIX OF THE SEALS HAVE BEEN BROKEN SO BE PREPARED FOR HARD SEVEN YEARS TO COME.
It is NOT my fault, I did not vote for this idiot Obama. Don't blame me.
I was struck by how he didn't seem to look into the camera(and me at home) once- almost deliberately.
Quit blathering on about the troops- current tragedy aside)start saying stuff about how(without giving amunition to the enemy) steps are being taken to bring them back- and steps being taken to address improving their(and everyone who
has already come home) needs.
He was reading off the teleprompters
Just vote them all out in the next two elections. I will take my chances on the inexperianced.
Who can we vote for? They are all chosen by the fabulous two party system we have. There never seems to be a "good" choice.
vote independent, there are several parties out there that have great alternative idea's about improving our situation.
Ron Paul is your man. If you listen Blizkreg, he'll state Romney as the front-runner when the US voter clearly can see who is winning the straw polls (Ron Paul). Wolfie, get with the program! Clearly you are not blind to the poll numbers conducted and the front-runner is Ron Paul. If the republican party blocks Ron from the field of "loser candidates", a revolution will be at hand. We won't stand for another blockade of the "only candidate" qualified to run and save America from the money grabbers in this nation.
Ron Paul 2012. The revolution begins... Remember, remember the 5th of November...
Yes but now we have a coalition of Tea Party and Republicans and nobody voted for that either. We have Tea Party extremism and inexperience running Washington and I know I did not vote for that I am sure of it. I dont think Obama is a great President and I voted for him but its clear and crystal clear the Tea Party were sent to Washington to get him out of the White House its doesnt matter about the collateral damage (US) as long as the black man leaves the white house and no I am not black either. If the tea party are so sure they have the majority of Americans on their side why are they not running as a third party and instead of hanging onto the coat tails of the Republicans.
I am going with the Tea Party. They make common sense and respect the consitution. They also now that Government is to damm big and getting bigger. That has to stop so as we the people can survive. The dems and rinos are scared as hell with the Tea Party. They spin blame to them at every possible chance. That is a good sign the Tea Party is
getting stronger. Good I say / Independant from Iowa
You just the saw the result of the "inexperienced" in charge, we are below 12,000 and most likely pointed down further. Wouldn't it be just great if the Ryan Budget plan passed and retirees were relying on the market for their income – in the trash now – we'd be on the way to buy cat foor for our dinner, just like before Social Security was put into place. We need some people not signed onto some damn pledge and afraid to break it to start making decisions directed to the national good, not their own interests. Who the hell voted for Grover Norquist for any office anyway?
I hate this kind of thinking. I'll take an experienced politician who knows how to work with people over an inexperienced person any day of the week. We just saw what happens when you elect a bunch of freshmen into the house... DISASTER!
you already took chances on inexperienced and look what that got us. Obama
He might. The problem is how. The genervmont produces nothing. Wealth is produced by people working in the real market. So the possible solutions are:- The genervmont pays the debt with the money of those who work in the real market (no genervmont employees or politicians)- The genervmont negotiates with the banks to refinance the debts. The collateral is the money of those who work in the real market and it's going to be used to pay the debts. When your collateral is something you care about, you pay your debt. When the collateral is something that doesn't belong to you, why would you pay?- The genervmont negotiates with the banks a full write off of the debts. It's not for free, just a PR move. The banks are going to get benefits somewhere else and they're going to be paid with the money of those who work in the real market.It's simple math. Wealth can't be created out of thin air. Somebody has to work hard to create it. Money, on the other hand, can be manipulated endlessly. But in the end, it's going to be backed up by the wealth created by those who work in the real market.
That is actually a good idea, in theory. Vote everyone out. However, everyone we vote in will also be easily financially influenced people who will at best, slowly but surely succumb to the lobbying efforts downtown. Lobbying is why we are where we are, today. Lobbying efforts result in the creation of incredible amounts of unnecessary spending, and is the reason why we are in this particular market slide.
as intelligent as my response might seem (i am correct regardless of what others may think), I don't vote anymore, which everyone tells me is part of the problem. however, all i have seen the last 12 years is that the voting in this system, is the problem. The entire system is F-ed, and I don't have a good solution to fix it aside from getting rid of special interest groups, PACs, and to make lobbying illegal.
This is exactly the reason we are in this pickle – voting for imbeciles with no experience is a very bad thing.
I think we just tried inexperienced - the tea party freshmen. That didn't work so well.
The reason why we're in this mess is BECAUSE of the inexperienced:
1. Chicken-hawk GW Bush and Dick Cheney NEVER SERVED (Bush was on a binder for 18 months and never saw combat; Cheney deferred his way through the Viet Nam war): Took us into two unfunded wars with no strategy or long-term plan (except to say the Iraqi oil would pay for the war and we wouldn't be there longer than 6 months).
2. Arrogance in disregarding both the Clinton transition team's warning about Osama bin Laden and the August 6, 2001 Presidential Daily Briefing entitled, "Al Qaeda Determined to Attack the US Using Airplanes."
3. Voodoo economics via tax cuts during wartime, pushed through by GW Bush, even though it was already a PROVEN FAILURE under Reagan (who has the stones to raise taxes when he saw the deficit balloon as a result of his economic policies). Heck, Cheney even told us in 2004 that "deficits don't matter."
4. Teabaggers elected in 2010, willing to destroy our economy for the sake of short-sighted, rigid, self-righteous deology.
THAT'S what's been sinking us. And THAT'S what we must rectify in November 2012 by voting Democratic.
You Have inexperience already and what has that gotten you?
A small and simple place to start – focus on the fix and not on the broken. So far all we've heard is everyone blaming everyone else (and everyone blaming Washington DC – which is a PLACE) instead of taking a good look at themselves. A false recovery is still false. Arguing about whether the fault is with the President or Congress is about as pointless yelling at the sky. So if you sell low and you take a loss, the fault is yours. If you believe an organization that has repeatedly shown themselves to be poor decision makers, the fault is yours. And if you want a job, be willing to do whatever job you are qualified for...not the ones you think you are qualified for that don't exist.
No, it's important that people understand that it is CONGRESS that is responsible for the budget, NOT THE PRESIDENT.
I say this because I'm sick and tired of the GOP and the teabaggers doing everything they can to harm our country – even taking it to the brink of financial disaster – so they can blame President Obama in their efforts to make him a one-term president.
This party before country, treasonous behavior on the part of the GOP and the teabaggers MUST STOP.
Why ANYONE would support these two groups is beyond me.
Voting (and continuing to support) for a Republican is like a chicken voting for Col. Sanders.
After the debt ceiling nonsense, this should be abundantly obvious.
Exactly, DC is a place... my home town. You guys vote your 'boobs' here. Its not the cities fault that you send the types of people that you do.
How can your economic people say NO ONE has come up with an economic solution. The House passed Cut, Cap and Balance!! But, Dirty Harry wouldn't EVEN bring it up for a vote in the senate!! Let alone get it to the president's desk!!
would have been nice to have cut cap and balance when Bush was in office that's for certain.
Cut cap and balance is a profoundly bad policy. I could list all the reasons it is wrong, but the net effect would be to turn America permanently into a country that could not respond to a crisis and would concentrate what little wealth is in the hands of the middle class into the 2% elite. Please read some analysis of the idea. It is not a very good one.
Cut, Cap and Balance wasn't a solution. It was the GOP's platform of cutting services and not raising taxes. Not that the final bill was much better.
If you want a solution, look to the plan of the bi-partisan Gang of Six. Three republicans and three democrats who actually set aside rhetoric to agree on a compromise. Which was blasted by both parties for daring to compromise (the shame!). I'd re-elect those six, and get rid over every single other congress member, if it was up to me.
Wolf does not understand the implications of the market decline. Wolf stated that Over $2 trillion dollars is lost...gone! The market has not permanently lost. The markets go up and down. His program was over dramatized– scaring people and the markets......anything for ratings! It was arrogant for Wolf to criticize Obama for celebrating his 50th birthday and then to say that something to celebrate was Wolf's program's 6 year anniversary.
Wall street did again. In 1930 and lately. Unlucky Obama!
Why is Obama "unlucky"? I'm seriously asking. Because we all know when history writes these pages exactly who the onus will be on when the dust settles. (And heres a hint... its not the Oval Office)
Everything Obama touches turns to s...
Greetings:Our potus should not operate on luck!! He should draw from his past experience and apply his moral mind to the problems at hand. He should be doing the will of WE THE PEOPLE
Now here in lies the problems.
He has no experience. What he has is sealed from public view. I pray he will wake up soon before he crashes into the
the up coming dead end. I hope and pray that he will soon see the light.
What annoys me is for some people the only answer is impeach Obama, or "vote 'em all out" next year. OK, vote them out for whom, exactly? As noted, the Republicans (Tea Party and otherwise) share the blame with the Democrats. A bunch of independents wouldn't be able to do much better. And anyway, that's 14 months from now. Do these people really want to paralyze government even more at a time when they need to get their houses in order (literally) and fix the problem?
Exactly! Do these same "vote the bums out" people think it'd be a good idea to replace everyone on a professional football team with grocery store clerks and accountants?? I'll take a career politician who knows their job over an inexperienced freshman any day.
You're right, and many in Congress who signed the Tea Party Pledge are freshman representatives. Though voting them out may be the right tactic, there is always the risk of replacing sleazy, corrupt politicians who might be willing to compromise once in a while with wild-eyed radicals and cynical opportunists who will hold the line no matter what. LIke in 2010.
Paralized is where we are now. Yes I would like to replace the potus and the 535. It s Time for term limits and
controlls put on there perks. They need to be on Social Serurity like the people they represent. They need the
same pension plan and health plan the rest of us have. They are to serve and instead they are wanting to be served and that is a big problem. Cut , Cap, & Balance would dig us out of the hole we are in. Now find those with the go nads to put this plan in to action.
Thank you Tea Party, you ignorant morons.
just make sure your anger is still around come election time 🙂
Billy have you been listening to what S & P said was the reason? Apparently not , "it was the tea party's fault"
Sorry... your ignorance is showing. IF the tea party had been stronger, this market turmoil would NOT HAVE HAPPENED. Reason: they are the only ones who are serious about tackling the problem of debt and the entitlement mentality. The rest of washington is too busy trying to buy votes with other people's money AND THAT IS WHY S & P downgraded our credit worthiness.
How can you hate me? You don't even know me.I am just like you but a member of the tea party.I am not as you called me .
Your welcome, expect more in the future. We are going to bring this out of control Government, back under the peoples control. Cut, Cut, and Cut some more.
You are going to try to blame the group of people that have been warning that this was coming since the day Obama took office? You really want to try to blame the group of people that passed Cut, Cap, and Balance...a bill that S&P stated would have allowed us to keep our AAA credit rating? The ignorance that comes from the left is astounding. Enjoy la-la land.
Finally President Obama will be making recomendations to this committee. It is way past the time that he needs to step up and lead. Republicans, like them or not, passed a budget and a debt reduction plan this year that would have satisfied the ratings agencies and put our fiscal house in order while reforming the Entitlement programs and the tax system. These plans are on the table but have been ignored or blasted by the dems while they have no real plan of their own. Lets hear a competing "Big Plan" from the president. Lets hear what exactly he would cut and exactly who's taxes would go up (I bet it won't be just millionaires and billionaires) to bring down the debt.
S&P already said what was necessary to avoid a downgrade. The Republican's refused to even discuss it. Speaker Boehner and President Obama had worked out the deal... $3T in cuts over 10 years, $1T in revenue over 10 years. S&P said point blank that what they needed to see was a minimum $4T dollar package that was balanced and realistic. The House Tea Party Caucus would not even allow the possibility of such a package to come to the floor.
Obama supported the bipartisan plan to cut 4 trillion. It included closing tax loopholes and revision of the entitlement programs. Regretfully, the GOP members in the house walked away from the talks. Please keep in mind that the GOP's plan didn't follow the guidelines of the rating agencies...and would have prompted their own economic downturn as everything would have been defunded.
Independent Senator Bernie Sanders of Vermont has had a plan that is "big" for months that mostly includes some common sense fixes such as closing ridiculous tax loop holes. Stopping subsidising oil companies that are making record profits etc. But it is unthinkable for republicans to even close a LOOP HOLE!! Obama was trying to introduce a compromise that had for every 6 dollars cut 1 dollar of revenue increase and Bohner wanted to agree but the tea party people would not budge an inch. So what is Obama supposed to do? Republicans have not had a real plan either. Every plan they offer is completely outlandish. Come up with something real that everyone can agree to. If Democrats are willing to agree to cuts to medicare then at least Republicans should agree to let the Bush TEMPORARY tax cuts expire or at least close loop holes. As long as Republicans are just standing in a corner demanding that they get everything they want and Democrats get nothing in return this country is going down the toilet. This is kindergarten behavior.
Wolf;
One of your guests, commenting on Texas Governor Rick Perry, said "he is very good on jobs". I'd like to call her out on that. A look at the Texas employment figures from the Bureau of Labor Statistics show that unemployment in Texas has risen steadily since he took office in 2000.
I am from Texas. Perry has nothing to do with the Texas so called "better economy". We have a very diverse economy before Perry was ever Governor. We have minerals which has helped our economy be in a better position. There are very few good paying jobs. My husband has been underemployed since the post 911 recession. My husband now has a master 's degree. Still no job. Most of the jobs under Perry are very low paying jobs.
Darrel,
Two points should be made to your broad brush comment. Unemployment has increased in every state since 2000. Total population ( a major factor in the unemployment calculation) has increased substantially in Texas over the same period.
Agreed. Its criminal that journalists don't bother verifying and reporting on facts anymore.
http://www.bls.gov/web/laus/laumstrk.htm
Texas is smack dab in the middle for unemployment, ranked 26th among states for unemployment rates in June 2011. Not sure how "average" is "good", but thats politics for you.
I don't know about you – but the President's speech today did little to make me feel better. He had an oppotunity to be a real leader today. He should have shown up with Biden, Boehner, Reid standing behind (or beside him). He could have outlined what they were going to do about this mess and that they vowed to work together to get this resolved and get it resolved quickly. If he would have done this – I would have held out some hope that they meant business for once in a very long time. So might have the stock market, since it just pummeted further after this weak speech. What the heck is it going to take for these people to get a clue? I'll volunteer to come to Washington and lead a team of empwered people to a positive outcome.
obama's disgraceful failure is destroying america and its clearly time to remove him from office.......
how ridiculous – no matter how much you give to a public corporation, they will still prefer to pay $1.00 per hour overseas than $6.00 to an American. It is simple greed that has destroyed us, not President Obama.
And the American Public is guilty of being "complicit" for 30 years. Striping the money tree all but bare, while taking advantage of breaks and incentives that afforded them "the good life", never mind the consequences! We have dug the hole, now we have to contend with the pit we helped Washington create! The fault rests with every American and NO ONE PERSON is alone in that RESPONSIBILITY!
What is disgraceful about it? Please elaborate for us all...
CONGRESS controls the budget process, not the president.
If you turned off Fox and Limbaugh and started thinking for yourself, you'd know this, you nimrod.
Right, and the teabaggers that WANTED A DEFAULT are clueless morons that foam at the mouth simply because they think THEY KNOW WHAT IS BEST FOR THE COUNTRY? Teabaggers ARE FULLY AT FAULT FOR THIS FINANCIAL DISASTER !!!!!!!!!!!!!!!!!!!!!!!!!!!
I think America was pretty much destroyed by the time Obama was sworn in. Republicans and Tea Party put the nails in the coffin.
So I can't really say I am surprised since our gov't is allowing a bunch a rich idiots to regulate our countries finances. Why are the Tea Party still allowed in the building, they should have had an automatic impeachment for trying to bring our American Economy down! Next election I will vote for any body as long as they are not a Tea Party member. All this time I though Republicans were our worst enemies, the Tea Party has shown America for that what they are all about. CAP or spending so the poor and disable will go without, CUT or life lines off so that again the poor and disabled go without, and BALANCE the ignorant rhetoric they keep yelling about, Stopping the socialist hell stop the dictators/capatilist. If America ever has a Tea Party president which I know hopefull will never happen we are up the creek without a paadle.
bravo
Joi c. We already ARE UP THE CREEK W/O A PADDLE. That is why the tea party came about. It was both parties that got us here by thinking they could keep giving money to their supporters. IT WAS NOT THE TEA PARTY'S FAULT.
Sorry... your ignorance is showing. IF the tea party had been stronger, this market turmoil would NOT HAVE HAPPENED. Reason: they are the only ones who are serious about tackling the problem of debt and the entitlement mentality. The rest of washington is too busy trying to buy votes with other people's money AND THAT IS WHY S & P downgraded our credit worthiness.
You have limited intellect, and that is wording it kindly. You clearly know nothing about economics. The problem is DEBT; debt is the result of overspending. If one doesn't have enough revenues (income), one can not pay debt down or off. The government has no money of its own; it only has what it takes from the citizens. If you raise taxes (that is, take more money), the citizens have less to live on, invest with or hire people. Jobs are then lost. Tax revenues DECLINE.
Please, please, please...get an education.
One thing the tea party operates on is common sense like 2+2+4. Our current leadership can't even balance a budget and that I learned in grade school. Its is a spending problem and Government to big for the common good that the Tea Party is trying to fix. We were the envy of the world and we are fast becoming laughing stock. Borrowing and printing Money to operate can't go on and on forever. Your marker will be called and you better have equity to back it up
Sorry to say we in America Can't Pay our Marker at this time. Business as usual will only compound the problem
May the Good Lord Bless the Tea Party.
Wolf,
No... Obama doesn't get all the blame... but he deserves a big part of it.... during the debt deal Obama could have made it very clear that the USA would never default.... that default was not a possibility because our debt would be paid in front of everything else... Instead he chose to play the "default" card in order to use it as leverage to get a political settlement... the media talked non-stop about the possibility of a default and the results of default.... this put a scare all over this country and the world.... none of that had to happen. If default had been instantly removed from the table (which it could have been) we very likely would not have seen a downgrade at this time...
It wasn't Obama who said "default won't really hurt us."
The U.S. hasn't defaulted on anything. If Boehner and the tea party gang had accepted Obama's "big deal" the U.S. credit rating wouldn't have been downgraded.
Boehner, et. al. preferred to play politics and the credit rating downgrade rests squarely on their shoulders.
The downgrade wasn't because the word default was used. It was becasue the US has mounting debt and a goverment who appears unable to address or deal with it. Please review S&Ps words on the subject. The circus that we saw in Washington was a truely dysfunctional government who "kicked the can down the road." For all of the screaming and gnashing of teeth, very little real headway was made (in the GOP plan, the Reid plan, or the actual plan that was approved). People don't want to look at the entitlement programs (SS, Medicare), increased taxes, AND cuts in defense. They are political hot potatoes as "we the people" will get mad when changes are made. Well, someone needs to do it! Ignoring it like we did (and continue to do) is just getting us into more trouble.
Bobby,
Had Obama said that, the tea party and GOP would have nailed him for it since congress controls the purse strings. All he can do is sign off on their legislation or veto ... which can then be overruled. It wasn't Obama that drove this off the cliff, it was the tea party saying who cares if we default. Between a rock and a hard-headded tea bagger.
Repeat: CONGRESS controls the budget process; it is the responsibility of CONGRESS to pass a budget. It is NOT the president's responsibility.
If you don't believe me, read the freakin' Constitution, for pete's sake! Try doing that instead of listening to and believing everything Fox and Limbaugh tell you.
This mess belongs to CONGRESS and specifically to the GOP and the teabaggers who have recklessly endangered our nation.
I think you hit the nail right on the head. He(Obama) did not play his cards right.
Wolf, I am concerned about the way things are in Washington. I see the Republicans as holding the masses of this country hostages by their unwillingness to compromise. It is clear that we must have increases in taxes in order to achieve a deficit reduction. It appears that many republicans have very little knowledge of economics and no idea how what they do affect even the average American. I certainly hope with what is happening with the stock market they will not even think of trying to privatize social security. Also, I am increasingly concerned about the sparation of church and state and I see many politicians increasingly trying to use their office to force their religious beliefs on the masses of the people. Bachman and Perry is a plain example. I am a Christian but not sure if they know the meaning of separation of church and state and really scared of these religious fanatics. I hope my voice is heard and thanks for doing a great job.
I remember in high school being taught that compromise was the essence of governing, the backbone of our American democracy. When extremists on both the right and left act like responsible deal making is a sellout, the result is that nobody wins and we all lose, as in today's stock market selloff. Listening to the news and interviews with current politicians makes me feel like I am being led by adolescents, not adults. Obama is not totally without blame for the mess we are in, but at least he is trying to act rationally, not merely talking "faith-based" ideology and unwavering policies. Political relationships like personal ones are based on give and take, not "my way or the highway."
Sure, raise taxes when we're on the brink of a depression. What a brilliant idea.
It doesn't take a financial wizard to see that S&P is playing a game of 'we don't get mad, we get EVEN'! All of these self-serving,private credit rating agencies need to be SHUT DOWN. They are a part of the Wall Street 'gamblers' that created the economic mess the USA is now trying to deal with!
When they downgraded Berkshire but didn't seem to know the banks were in trouble that sold me they didn't know what they were talking about.
I sense the sound of "sour grapes" and some deep seated hostility! S&P was right to downgrade this "debt magnet" of a government and would do well to downgrade them even further. Investing in a company so broke that all new investments are simply paying the outstanding balance is just bad business and will only serve to postpone the inevitable.
Yep shoot the messenger; that alwasy works...
when we needed them to be honest, they weren't – now they are fanning the flames and causing panic These are the same guys who liberally gave AAA ratings to the synthetic CDOs that had no value and wrecked our economy and premier position as a safe place to keep your money. They are part of the problem that is dragging the US to third world status....
Don't be dramatic. AA+ isn't third world status.
And yes, they should have downgraded the junk that they were supporting before the crash. I guess that they've (finally) started to do their jobs...its just a real shame that it happened to hurt our country.
No doubt the economy is in serious trouble and has been since 2008. The ratings folks told The president and the congress what would happen if they did not cut the deficit by 4 trillion dollars and the end result was exactly what they said. No one is to blame but our own government for that fiasco and credit rating drop. They had months to do something and they didn't. Now the rest of America is on the hook for what they failed to do. Our congress needs to go. Each and every one of them.
I'm keeping my Senators and Representatives – they actually know how to think and care more about the people they represent than the likes of the Koch brothers.
BTW, did you know that the Koch brothers' father made his fortune by building oil refineries in Stalin's Russia? Yep, that tells you VOLUMES about where their loyalties lie – and it's with MONEY, not with our nation, not with democracy.
Money – that's all that matters to the Koch brothers, and all the GOP corporate masters and their teabagger flunkies.
Same people are doing the same decisions. This is not a 2 year problem. It started way before Regan Sr.
Richard ... Thank you! Thank you! Thank you! Finally someone on CNN gets it. S&P gets it. US Investors are finally getting it. Moody's is finally getting it. It's Ali Velshi who just doesn't seem to get it. It's really quite simple. The 600+ drop in the market today has very little to do with Europe. It's the ecomomy stupid! The US economy SUCKS! The US job market sucks! The US housing market sucks! Fixing our economy will be hard and painful and Washington just doesn't have the courage to fix it.
Obviously you haven't been listening very well. The European markets have a LOT to do with in. Even the folks say so. True, our economy sucks and plenty of blame to go around. But one group of people I never hear taking any blame, WE the American people. We buy the biggest baddest trucks and then blame the automakers when gas goes sky high. A lot of people bought homes on fancy financial terms they couldn't afford (as they were told home values always go up). As appraisals went up, we used our homes as credit cards with 2d mortgages. Many of us didn't save for a rainy day. Our government allowed a lot of this with de-regulation, but many of us didn't use common sense.
We Americans like tax cuts, not worrying about what that is doing to the debt. We like the drug prescription bill, not caring about what it did to the debt.
S & P should have downgraded Fannie and Freddie a long time ago. But yet they kept their AAA rating on them even through the housing crisis and let them continue to back not so good loans. Now they decide to downgrade them when they are pretty much the only ones still backing mortgages (the banks do not hold the paper).
The housing crisis will worsen with this. I digress............the global economy is all tied to each other. If one goes bad, the markets will reflect that. Congress nor the President can do anything about that.
AMEN!!!!
What will be required to change economy in America? Well to start eliminate all the for life pension plans for all the senators and politicians that are signed for life. Change the entire congress and senators. Re-do elections.
Please, Jack and Wolf... Do not make economics policy comments when you don't understand economics. The S&P downgrade of U.S. debt had nothing to do with the drop in stock markets today. TREASURY PRICES WENT UP. In other words, the markets ignored S&P.
Our national debt is far from the highest in our history. We can bring it down by growing the economy (pretty much painless) or cutting spending (pretty painful). We could bring it down in a hurry by increasing income taxes and cutting loopholes. S&P has it all wrong. So do you.
The stockmarket dropped because of fear. The decrease in the US's credit rating just amplified the fear. If people are afraid, people pull their money out of stocks and park it...where...in money market accounts and bonds. The European governments (and the Euro) are even more concerning so US Bonds look pretty good. The US will pay tomorrow and next year. The overall credit rating looks more long term than that. The temporary money invested in bonds today is likely to move elsewhere once people can figure out what is safe.
PS. The required selloffs from funds that require a AAA rating and the impact of the rating downgrades hasn't other govermental bond markets yet. This change is likely to have a more longterm effect than a single day in the market. You need to work on your economics.
Hey Jimmy,
How much did your stock market go up today?
I am just a common working man. I pay to much taxes now. I don't need a tax increase. If the Government take more I would be better of not working. I will have lots of company at the welfare line as it don't pay to work if you can't keep most of what you make.
Wolf keeps saying that 1 trillion just disappeared.
Someone sold and realized the profit, again!!!
Why doesn't anyone say that?
Because the only one who would is Rachel Maddow! The rest were all fired and replaced by people who aren't really journalists.
Dave,
Hats off! Keen observation of the day.
You are assuming that someone had a profit to realize. Most likely the people that were selling today were simply trying to cut their loses. As of Friday the average 401K had lost about 10 percent in value. I sure that anyone brave enough to look at their 401K read out and find that they have less money than they did 2 weeks ago will agree with Wolf. It disappeared.