The United States may be on course to lose its 'AAA' rating due to the large amount of debt

[seemslikeadream]

Watch the video

http://www.cnbc.com/id/27641538


The United States may be on course to lose its 'AAA' rating due to the large amount of debt it has accumulated, according to Martin Hennecke, senior manager of private clients at Tyche.



"The U.S. might really have to look at a default on the bankruptcy reorganization of the present financial system" and the bankruptcy of the government is not out of the realm of possibility, Hennecke said.

"In the United States there is already a funding crisis, and they will have to sell a lot more bonds next year to fund the bailout packages that have already been signed off," Hennecke told CNBC.

In order to solve or stem the economic slowdown, Hennecke suggested the US would have to radically reduce spending across all sectors and recall all its troops from around the world.

As for a stimulus package, there is not much of an industry left to stimulate back into life, Hennecke said.

[roamer65]

1. The government will not go bankrupt.

They control "the printing presses". We will see hyperinflation before we see bankruptcy.

[ProdigalJunkMail]

2. this is kind of where i felt the republicans were trying to go

to bankrupt the gov't in order to force a reduction in spending on programs they don't like...i think there will have to be broad spending cuts to stem the tide debt this country continues to roll up...

sP

[BootinUp]

3. but this is nonsense.

The US treasury securities are still seen as a safer investment than any other country's currency.

[kurt_cagle]

7. Only because assets are US denominated

If you are a foreign stock-holder or have an equity position in pretty much anything, in order to pull out of the market you have to move your money into T-Bills, then move it from that to another currency, which is why everyone at this point is buying up T-Bills, driving up the exchange rate. It won't last. As the economy continues to weaken, all those holders of t-bills (most notably China) are going to give up on getting a decent redemption rate and will sell into a loss just to avoid a worse one, which, along with the Fed-induced inflation going on, should just absolute goose inflation ... anywhere from 6 to 18 months from now.

[smiley_glad_hands]

4. There will be war then. eom

[natrat]

5. one way or another they plan to fuck you out of your money

[roamer65]

6. Bingo. Either much higher taxes or hyperinflation.

Both are basically the same. My choice is to reinstate the income tax levels of the New Deal era. 80 to 90 percent on CEO type incomes.

[ForrestGump]

8. No AAA rating?

Darn. Where am I going to live? I mean, I prefer at least one triple-A diamond on my accommodations... :-(

Does Michelin still have a rating for the USA?