Tea Leaf: Debt explosion has nation playing chicken with S&P

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  • ouisc Farmington, UT
    April 27, 2011 3:19 p.m.

    Think about it. For every dollar I give the Federal government, the Federal government spends $1000, and charges me the interest on the difference.

  • Brother Chuck Schroeder A Tropical Paradise USA, FL
    April 27, 2011 11:14 a.m.

    Who plays chicken?. With no clear policy in place past June, and the economy showing worrying signs of slowing again, the stakes are high for Bernanke. For much of its 97-year history, the U.S. Federal Reserve has been an opaque, imposing, somewhat mysterious institution that relied on secrecy to hide its innermost deliberations from global financial markets. No more. In the five years since the ascension of Chairman Ben Bernanke, Fed board members and regional bank presidents have been increasingly outspoken about policy disagreements. Bernanke's testimony to Congress has transformed "Fedspeak" the imponderable dialect spoken by his predecessor Alan Greenspan, into plain English. That policy of openness - some have called it the Fed's Glasnost - will reach a new milestone Wednesday when Bernanke holds the first regularly scheduled briefing ever given by a Fed chief, kicking off what is to be a quarterly event. The briefing, to be broadcast live on the Fed's website and other outlets, will begin at 2:15 p.m. EDT after a regular meeting of the policymaking Federal Open Market Committee. Bernanke could face a long list of questions about the Fed's effort to stave off economic disaster.

  • DeltaFoxtrot West Valley, UT
    April 27, 2011 10:56 a.m.

    People proposing state banks and state currencies are delusional. Only the federal government has the power to print money. As long as Utah is part of this union we have to play by the rules. I suppose Utah could always secede... but didn't several states try that a while back? Yeah... see how that turned out.

  • Elk1970 Holladay, UT
    April 27, 2011 9:21 a.m.

    A state central bank? A state currency? Would Wyoming accept my currency when I go to buy a Subway sandwhich in Laramie or would I have to carry two currencies?

    Can we really live off the grid?

  • DeltaFoxtrot West Valley, UT
    April 27, 2011 9:08 a.m.

    Realistically, S&P would be foolish to lower the US Govt's credit rating. As we are one of the largest economies in the world, everything we do has an effect on all the world's nations. If US debt is seriously downgraded it would essentially collapse the world economy, which is something (I hope) S&P is particularly aware of.

    The 50's through the 80's were the military Cold War, with both sides sitting on "the button" that would end everything. Now we're in an economic Cold War and the credit bureaus are sitting on that button. If they press it, the entire civilized world is doomed.

  • facts_r_stubborn Kaysville, UT
    April 27, 2011 8:52 a.m.

    More rediculous political rhetoric from demagogues from both parties who play to the emotions and fears of the largely cynical, ignorant and irrational populous.

    We always hear from those that say the government should live within its means like a family must do. Well the problem in our country today is that most families are in debt over their heads, and they want to vote themselves entitlement benefits that are more than the nation can support. The demagogue politicians are just telling us what we want to hear.

    The fact is entitlements and other areas of government spending need to be brought down to sustainable levels. The entitlement programs should be a safety net for the needy not a retirement and universal health plan for everyone. Means testing and a gradual raising of the retirement age will achieve most of the solution.

    Families and our government should solve their debt problems, by living within their means. They should not and cannot solve the problem by defaulting on their current obligations. That will only make matters much much worse.

    Reduce spending, bolster the economy with sound policy, lift the tax base, but do not refuse to pay our debts.

  • Esquire Springville, UT
    April 27, 2011 7:48 a.m.

    So much that could be said on this. But shouldn't it really be on the opinion page?

  • M. Matchette Syracuse, Utah
    April 27, 2011 6:32 a.m.

    We could cure this almost overnight in the State of Utah. Getting rid of the Fed is just a start. The smaller banks that spring out from the Fed must stop the criminal practice of fractional reserve banking. Utah can establish it's own bank and state currency that is from the people for the people. This pain can be avoided by creating a state central bank, of which the state pays no interest to borrow and distribute funds. It will take the people to back it up when the fed, and their "bought-and-payed-for" friends feel enticed to send troops to our streets because we value freedom and won't be slaves to their fraud anymore...

  • MyChildrensKeeper Kearns, UT
    April 27, 2011 4:00 a.m.

    No matter how this congress addresses the issue of our deficit and spending it will not change as long as they continue this spiraling economy going nowhere. Our economic power is beyond saving and we are no longer a world leader. The death of the American dream is near its end thanks to government debt.

    What government has done to this country with socialism and what corporate america has done by deserting its country has put the US in to a reverse economy. The power and wealth of a nation depends on its industry and production for its self and the world. The US is no longer a productive self supporting industrial nation, we are a dependent nation with more poverty than any other 3rd world country. In the last 30 years the only thing this nation has produced is poverty and welfare. Gradual at first but now it is in a landslide. When most of a governments budget goes to welfare what can that tell you? The people don't have enough money to tax them to get the government out of debt. Besides, they would only be taxing the welfare payments given to illegal aliens and citizens.

  • peter Alpine, UT
    April 26, 2011 7:23 p.m.

    All are great and informed comments about the intentional "criminal negligence" of the Federal Reserve. Be ready to stand as a people as our federal government self destructs under their own gluttonous power grab. They will never succeed with their purposes in America. Their days are numbered.

  • JMT Springville, UT
    April 26, 2011 6:26 p.m.

    10 years? Add Paulsen and Greenspan and you have the four largest thieves in modern history. Their actions have robbed trillions and shifted hundreds of billions. And not just in America. Their work via Goldman Sachs (two of them alums of) include theft in Greece and Portugal via hidden bonds, etc. And when they went bad, We The People bail them out. AIG, massive bailout for the same crew. All of this reported in the pages of the Dnews, but how many read or connected the dots?

    If we knew the full measure of the Federal Reserve we would likely grab pitchforks tomorrow, hence their absolute fight over being audited.

  • Vince the boonies, mexico
    April 26, 2011 6:07 p.m.

    Seeing that picture of Geithner and Barnache makes me nauesated. Two more "big business" crooks that have gutted this country in the last 10 years!

  • Instereo Eureka, UT
    April 26, 2011 4:34 p.m.

    Just like any business, there are two things to do, 1. Cut back on expenses and 2. increase revenue. So Congress needs to trim the budget and increase taxes. Both the D's and R's spend way too much but the tax cuts for the past 20 years have also left their mark on our debt. If we had the same tax rate as we did 20 years ago we'd have a balanced budget. So it's time to rethink what government is about, fund what we want it to be, get rid of what we don't want it to be, and make sure we have enough revenue to pay for what we government we have left.

  • Owl Salt Lake City, UT
    April 26, 2011 4:08 p.m.

    Our government has adopted the plan to shoot the messenger rather than address the problem of national debt. Criminal negligence describes the administration's performance on budgetary matters.

  • JMT Springville, UT
    April 26, 2011 3:15 p.m.

    Decent play-by-play with yet another economist kicking the can down the road. He correctly notes that we are following in the steps of Greece, Portugal, Ireland, even the UK has shown serious pain. The pain of government greed is evident in all countries, the big difference is the Dollar. The US is the world's reserve currency via the dollar. As that implodes it forces a "New World Order" of austerity on us that will be as shocking as diving into the Great Salt Lake January 1 at dawn in your boxer shorts.

    Forgive my play on the 'new world order' thing but things are going to change. America has played the balancing act of welfare/warfare state for far too long. It's the 'Republic' versus 'the Empire' game, and the Welfare/warfare empire is winning.

    Jeff, I am a subscriber to your newsletter, love your opinion in general. I hate that you've bought the Geitner line that only mature people destroy the economy with more debt. Your are more afraid then wrong. You and so many others hope that this 'kick of the can' actually works. Been saying that for decades now: Keynes is dead!