Bruce Banner Posted July 30, 2011 Share Posted July 30, 2011 Sky's "money expert" David Kuo was just on Sky news. I only caught the end, but he said... If UK banks have lent America money and America defaults on their debt, our banks will have less money to lend and our housing market could collapse. Quote Link to comment Share on other sites More sharing options...
@contradevian Posted July 30, 2011 Share Posted July 30, 2011 Can imagine then plea's now to O'Bama "please don't crash our vanity housing market!" Quote Link to comment Share on other sites More sharing options...
Pent Up Posted July 30, 2011 Share Posted July 30, 2011 Good. And on the radio this morning "US debt talks collapse" Quote Link to comment Share on other sites More sharing options...
Bruce Banner Posted July 30, 2011 Author Share Posted July 30, 2011 It's all political from what I can see. Republicans want to agree an amount that will carry them through for a few months and see what cuts can do to improve matters. Democrats want a huge sum that will carry them through without cuts until after the presidential elections . Quote Link to comment Share on other sites More sharing options...
'Bart' Posted July 30, 2011 Share Posted July 30, 2011 Democrats want a huge sum that will carry them through without cuts until after the presidential elections . Every Democratic senator voted against raising the debt ceiling in 2006, including Obama (link) The fact that we are here today to debate raising America’s debt limit is a sign of leadership failure. It is a sign that the U.S. Government can’t pay its own bills. It is a sign that we now depend on ongoing financial assistance from foreign countries to finance our Government’s reckless fiscal policies... Increasing America’s debt weakens us domestically and internationally. Leadership means that “the buck stops here.” Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren. America has a debt problem and a failure of leadership. Americans deserve better. [At the time, Senator Obama was urging Congress not to tolerate an increase that would bring the debt ceiling to $9 trillion. Under President Obama, the debt ceiling has been raised to $14.3 trillion.] I agree with everything he says in that speech, a shame he doesn't. Quote Link to comment Share on other sites More sharing options...
OnlyMe Posted July 30, 2011 Share Posted July 30, 2011 It's all political from what I can see. Republicans want to agree an amount that will carry them through for a few months and see what cuts can do to improve matters. Democrats want a huge sum that will carry them through without cuts until after the presidential elections . Exactly the way I see if, both of them want to be able to print with impunity and dare not even attempt to fix the problems, just extend and pretend that best suits them and their direct funding partners - i.e. the wallstreet gang and a few select corporates. Meanwhile the US is still bleeding jobs to China. They are defaulting already through devaluation, yet the situation is still getting worse, theere is no policy, no planning to solve the core problem. Quote Link to comment Share on other sites More sharing options...
Blod Posted July 30, 2011 Share Posted July 30, 2011 I assume that American senators and all their politician's pensions are index linked. Quote Link to comment Share on other sites More sharing options...
aa3 Posted July 30, 2011 Share Posted July 30, 2011 On the other hand an America freed from its debt burden and possibly with a much reduced federal bureaucracy.. may experience a dramatic improvement in its economy. And really help drive global prosperity. Ultimately its not in the interests of foreign peoples to have Americans broke, or worse like unemployed, because of unpayable debts. If our banks lost so much money that they aren't capable of performing their core function of lending money.. then we should charter new banks that are free from old and bad debts. Sort of like if an industrial company gets too weighted down by pensions and debts, customers move to new industrial companies who are not saddled with those liabilities. Quote Link to comment Share on other sites More sharing options...
porca misèria Posted July 30, 2011 Share Posted July 30, 2011 It's all political from what I can see. Republicans want to agree an amount that will carry them through for a few months and see what cuts can do to improve matters. Democrats want a huge sum that will carry them through without cuts until after the presidential elections . AIUI that's not true, and republicans (except tea party) actually want more than the democrats. The big difference is in timing relative to election day. Quote Link to comment Share on other sites More sharing options...
catmandu Posted July 30, 2011 Share Posted July 30, 2011 We've been here before in America. They have a ludicrous system which splits power in a way that no one can actually get anything done. Would prefer to see Republicans get in power and immediately be able to do silly things e.g. ban abortion completely - it's much better than having an interminable debate about it, each side knowing it's never going to happen. Anyway, they'll just push it to the deadline then magically agree on a plan, blame each other for not getting it approved earlier and things will go on as usual. Quote Link to comment Share on other sites More sharing options...
Pent Up Posted July 30, 2011 Share Posted July 30, 2011 (edited) We've been here before in America. They have a ludicrous system which splits power in a way that no one can actually get anything done. Would prefer to see Republicans get in power and immediately be able to do silly things e.g. ban abortion completely - it's much better than having an interminable debate about it, each side knowing it's never going to happen. Anyway, they'll just push it to the deadline then magically agree on a plan, blame each other for not getting it approved earlier and things will go on as usual. Yep I agree. Edited July 30, 2011 by Pent Up Quote Link to comment Share on other sites More sharing options...
The Masked Tulip Posted July 30, 2011 Share Posted July 30, 2011 Long weekend... Wednesday could be a good day to go view a house. Quote Link to comment Share on other sites More sharing options...
interestrateripoff Posted July 30, 2011 Share Posted July 30, 2011 Every Democratic senator voted against raising the debt ceiling in 2006, including Obama (link) [At the time, Senator Obama was urging Congress not to tolerate an increase that would bring the debt ceiling to $9 trillion. Under President Obama, the debt ceiling has been raised to $14.3 trillion.] I agree with everything he says in that speech, a shame he doesn't. Someone should ask Obama what's changed from now and then, apart from him getting elected and finding he has to keep the plates spinning for the VI. I'm surprised one of the Republicans for political gain hasn't made the exact same speech in the Senate/Congress to cause maximum political damage. Quote Link to comment Share on other sites More sharing options...
interestrateripoff Posted July 30, 2011 Share Posted July 30, 2011 It's all political from what I can see. Republicans want to agree an amount that will carry them through for a few months and see what cuts can do to improve matters. Democrats want a huge sum that will carry them through without cuts until after the presidential elections . Yep screw America it's the next election that counts, both sides are seeking short term advantage but creating even bigger problems in the longer term. I wonder if both sides have calculated that generating a default will be to their advantage. Neither side will contemplate it might doom them both. If there is doing to be a 3rd party candidate potentially this could be the moment to finally break the 2 party duopoly of US politics. Quote Link to comment Share on other sites More sharing options...
The Masked Tulip Posted July 30, 2011 Share Posted July 30, 2011 I think people will move money around and some of it will come the way of the UK as they seek a safe haven and this will fill the banks coffers reducing the insolvency risk of the UK banks. Just look at how much property in london is being hoovered up by people abroad. Likewise Dagong (Chinas rating agency) downgraded the US last year, UK was downgraded by them this year on the issue of bank solvency, but this latest development will help reduce UK bank solvency issues, same goes for the capital flight from Ireland and Greece, some of thats come our way as well which all helps. It would be foolish to ignore the history and experience the UK has imo. If there is a default and there is another banking crisis it may well be an opportunity to either: 1. Buy into shares low. 2. Buy a house. I think HPCers should be aware and be prepared. Quote Link to comment Share on other sites More sharing options...
R K Posted July 30, 2011 Share Posted July 30, 2011 Someone should ask Obama what's changed from now and then, apart from him getting elected and finding he has to keep the plates spinning for the VI. I'm surprised one of the Republicans for political gain hasn't made the exact same speech in the Senate/Congress to cause maximum political damage. 6% crash in GDP. People seem to have short memories. Clinton ran a surplus. Bush, Cheney and the Goldman boys looted everything they could get their grubby paws on. Taxy taxy the corporates and slap mega tariffs on the Chinese and they'll have a trade surplus and a booming economy in no time. Simples. Quote Link to comment Share on other sites More sharing options...
interestrateripoff Posted July 30, 2011 Share Posted July 30, 2011 6% crash in GDP. People seem to have short memories. Clinton ran a surplus. Bush, Cheney and the Goldman boys looted everything they could get their grubby paws on. Taxy taxy the corporates and slap mega tariffs on the Chinese and they'll have a trade surplus and a booming economy in no time. Simples. Sorry what where you saying I've forgotten... Quote Link to comment Share on other sites More sharing options...
Bruce Banner Posted July 30, 2011 Author Share Posted July 30, 2011 6% crash in GDP. People seem to have short memories. Clinton ran a surplus. Bush, Cheney and the Goldman boys looted everything they could get their grubby paws on. Taxy taxy the corporates and slap mega tariffs on the Chinese and they'll have a trade surplus and a booming economy in no time. Simples. Of lies? Quote Link to comment Share on other sites More sharing options...
Bruce Banner Posted July 30, 2011 Author Share Posted July 30, 2011 If there is a default and there is another banking crisis it may well be an opportunity to either: 1. Buy into shares low. 2. Buy a house. I think HPCers should be aware and be prepared. Cash in the bank waiting........ for as long as it takes . Quote Link to comment Share on other sites More sharing options...
Pent Up Posted July 30, 2011 Share Posted July 30, 2011 There was an interesting slant in the FT this week that suggested that apart from the debt ceiling and default, unless Obama agrees to cut the budget deficit sufficiently (I think it said $4 trillion) the US would suffer a downgrade which would trigger a deleveraging event akin to that of Lehman's, as more collateral (typically US Treasuries) has to be posted in the repo market and therefore bets would be scaled back accordingly. The US should have already been downgraded. The ratings agency are telling investors that US debt is 100% safe and it is quite obviously not. Quote Link to comment Share on other sites More sharing options...
okaycuckoo Posted July 30, 2011 Share Posted July 30, 2011 I think it's pretty well established the US is not going to default. They have plenty of income to pay the interest. Quote Link to comment Share on other sites More sharing options...
aa3 Posted July 30, 2011 Share Posted July 30, 2011 Yep screw America it's the next election that counts, both sides are seeking short term advantage but creating even bigger problems in the longer term. I wonder if both sides have calculated that generating a default will be to their advantage. Neither side will contemplate it might doom them both. If there is doing to be a 3rd party candidate potentially this could be the moment to finally break the 2 party duopoly of US politics. There is another possible, however unlikely explanation. That the leaders in both parties know they have to pull the trigger.. default on debt, make serious budget cuts, serious reform. But neither side can come out and say that. So they have to blame the other side for not going along with their attempts to 'save' the current system. Quote Link to comment Share on other sites More sharing options...
R K Posted July 30, 2011 Share Posted July 30, 2011 http://en.wikipedia....ki/Laffer_curve You can link to wiki articles. Congratualtions! Corporates are awash with cash and pay little tax. One of the fundamental problems. You can quote Laffer nonsense as much as you like or you can admit to and address the actual problem. Quote Link to comment Share on other sites More sharing options...
mirage Posted July 30, 2011 Share Posted July 30, 2011 You can link to wiki articles. Congratualtions! Corporates are awash with cash and pay little tax. Are corporates really awash with cash? Do their assets greatly exceed their liabilities? If so, why are they holding onto cash, do you think? Quote Link to comment Share on other sites More sharing options...
Guest spp Posted July 30, 2011 Share Posted July 30, 2011 Political theatre. They will raise the DEBT ceiling! Quote Link to comment Share on other sites More sharing options...
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