The big problem is with a lower rating the interest rate will go up. That means more of the income will be wasted to pay interest on debt already accumulated. This has got to stop. This is what dealt the fatal blow to the German Republic in the '30s that made it possible for Hitler to become a dictator.
At the time, the Mark became so devalued, you couldn't even carry low denomination note because it would require so many to purchase anything. That is called massive inflation.
Borrowers love this since it takes far less time to pay back a loan. Lenders hate it since their initial investment is rendered valueless. Consequently, our present government would love to see it continue.
Remember when the British Pound Sterling was devalued and they went to the "New Pound"? That could very well happen here.
http://en.wikipedia.org/wiki/...
Free-floating pound
With the breakdown of the Bretton Woods system, the pound floated from August 1971 onwards. It at first appreciated a little, rising to almost $2.65 in March 1972, from 2.42 when it had been fixed. The Sterling Area effectively ended at this time when the majority of its members also chose to float freely against the pound and the dollar.
1976 sterling crisis
James Callaghan came to power in 1976. He was immediately told the economy wa...
At the time, the Mark became so devalued, you couldn't even carry low denomination note because it would require so many to purchase anything. That is called massive inflation.
Borrowers love this since it takes far less time to pay back a loan. Lenders hate it since their initial investment is rendered valueless. Consequently, our present government would love to see it continue.
Remember when the British Pound Sterling was devalued and they went to the "New Pound"? That could very well happen here.
http://en.wikipedia.org/wiki/...
Free-floating pound
With the breakdown of the Bretton Woods system, the pound floated from August 1971 onwards. It at first appreciated a little, rising to almost $2.65 in March 1972, from 2.42 when it had been fixed. The Sterling Area effectively ended at this time when the majority of its members also chose to float freely against the pound and the dollar.
1976 sterling crisis
James Callaghan came to power in 1976. He was immediately told the economy wa...
The big problem is with a lower rating the interest rate will go up. That means more of the income will be wasted to pay interest on debt already accumulated. This has got to stop. This is what dealt the fatal blow to the German Republic in the '30s that made it possible for Hitler to become a dictator.
At the time, the Mark became so devalued, you couldn't even carry low denomination note because it would require so many to purchase anything. That is called massive inflation.
Borrowers love this since it takes far less time to pay back a loan. Lenders hate it since their initial investment is rendered valueless. Consequently, our present government would love to see it continue.
Remember when the British Pound Sterling was devalued and they went to the "New Pound"? That could very well happen here.
http://en.wikipedia.org/wiki/...
Free-floating pound
With the breakdown of the Bretton Woods system, the pound floated from August 1971 onwards. It at first appreciated a little, rising to almost $2.65 in March 1972, from 2.42 when it had been fixed. The Sterling Area effectively ended at this time when the majority of its members also chose to float freely against the pound and the dollar.
1976 sterling crisis
James Callaghan came to power in 1976. He was immediately told the economy was facing huge problems, according to documents released in 2006 by the National Archives.[21] The effects of the 1973 oil crisis were still being felt, with inflation rising to over 27% in 1975.[22] Financial markets were beginning to believe the pound was overvalued and in April of that year The Wall Street Journal advised the sale of sterling investments in a story titled "Good-bye Great Britain". At the time the UK government was running a budget deficit and Labour's strategy emphasised high public spending. Callaghan was told there were three possible outcomes: a disastrous free fall in Sterling, an internationally unacceptable siege economy or a deal with key allies to prop up the pound while painful economic reforms were put in place. The US government feared the crisis could endanger NATO and the European Economic Community (EEC) and in light of this the US Treasury set out to force domestic policy changes. In November 1976 the International Monetary Fund (IMF) announced the conditions for a loan, including deep cuts in public expenditure.[23]
1979–1989
The Conservatives arrived in power in 1979, on a programme of fiscal austerity. Initially, the pound rocketed, moving above the $2.40 level, as interest rates rose in response to the monetarist policy of targeting money supply. The high exchange rate was widely blamed for the deep recession of 1981. Sterling fell sharply after 1980; at its lowest, the pound stood at just $1.03 in March 1985, before returning to the US$1.70 level in December 1989.
(more)At the time, the Mark became so devalued, you couldn't even carry low denomination note because it would require so many to purchase anything. That is called massive inflation.
Borrowers love this since it takes far less time to pay back a loan. Lenders hate it since their initial investment is rendered valueless. Consequently, our present government would love to see it continue.
Remember when the British Pound Sterling was devalued and they went to the "New Pound"? That could very well happen here.
http://en.wikipedia.org/wiki/...
Free-floating pound
With the breakdown of the Bretton Woods system, the pound floated from August 1971 onwards. It at first appreciated a little, rising to almost $2.65 in March 1972, from 2.42 when it had been fixed. The Sterling Area effectively ended at this time when the majority of its members also chose to float freely against the pound and the dollar.
1976 sterling crisis
James Callaghan came to power in 1976. He was immediately told the economy was facing huge problems, according to documents released in 2006 by the National Archives.[21] The effects of the 1973 oil crisis were still being felt, with inflation rising to over 27% in 1975.[22] Financial markets were beginning to believe the pound was overvalued and in April of that year The Wall Street Journal advised the sale of sterling investments in a story titled "Good-bye Great Britain". At the time the UK government was running a budget deficit and Labour's strategy emphasised high public spending. Callaghan was told there were three possible outcomes: a disastrous free fall in Sterling, an internationally unacceptable siege economy or a deal with key allies to prop up the pound while painful economic reforms were put in place. The US government feared the crisis could endanger NATO and the European Economic Community (EEC) and in light of this the US Treasury set out to force domestic policy changes. In November 1976 the International Monetary Fund (IMF) announced the conditions for a loan, including deep cuts in public expenditure.[23]
1979–1989
The Conservatives arrived in power in 1979, on a programme of fiscal austerity. Initially, the pound rocketed, moving above the $2.40 level, as interest rates rose in response to the monetarist policy of targeting money supply. The high exchange rate was widely blamed for the deep recession of 1981. Sterling fell sharply after 1980; at its lowest, the pound stood at just $1.03 in March 1985, before returning to the US$1.70 level in December 1989.
I am looking all over for someone to mention that and I can't find it, but it is the third downgrade.
Stop blaming Bush, stop attacking Romney and start paying attention. The effects of the obama administration's decisions are ruining America.
How much debt is it going to take to make people realize that our Country is under water in debt and drowning? $17 Trilliion? $20 Trillion??? Where does the madness end?
I don't see anything done until your bonds are practically at junk bond status and either way when you do get out of this mess your going to have a hell of a lot less financial or political influence internationally.
I think the country can take it. If it can't, then it doesn't live in the real world anymore and doesn't deserve to survive anyway.
Get the 52.000 US troops out of Germany.
The President is a failure and America will fail if we don't vote him out!