ECB warns US may lose AAA rating

[*T*]

ECB warns US to lose AAA rating

English quasi-translation here.

"Under pessimistic assumptions, the large increase in the budget deficit and public debt mean that the USA downgraded," the ECB said on Monday in their published financial stability report. "If that happens, it could be important consequences for the global financial system, for example, through higher bond yields worldwide."

[FRED]

Re: ECB warns US may lose AAA rating

ECB warns US to lose AAA rating

English quasi-translation here.

The ECB is over-rating the ratings agencies. The financial markets are already pricing in the budget deficit and public debt. That is why the Fed is on the rubber chicken circuit complaining about Congress and their $85.6 trillion in existing public debt and unfunded liabilities.

Yield curve 50 days from June 12 to June 12

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See: The cheh shaped recovery – Part II: Yield curve says what?

[*T*]

Re: ECB warns US may lose AAA rating

Agreed. I was just surprised to hear the ECB mention this type of risk explicitly.

[FRED]

Re: ECB warns US may lose AAA rating

Agreed. I was just surprised to hear the ECB mention this type of risk explicitly.

Not surprising if our own central bank is doing the same! $85.6 trillion in existing public debt and unfunded liabilities.

[jtabeb]

Re: ECB warns US may lose AAA rating

Not surprising if our own central bank is doing the same! $85.6 trillion in existing public debt and unfunded liabilities.

Well at least, the congress approved the sale of IMF gold, that should put some downward pressure on that pesky gold price (and give them cover to issue more debt).

http://www.itulip.com/forums/showthread.php?t=10440

Thank god congress is looking after the financial stability of our blessed country so well.:mad:

[FRED]

Re: ECB warns US may lose AAA rating

Well at least, the congress approved the sale of IMF gold, that should put some downward pressure on that pesky gold price (and give them cover to issue more debt).

http://www.itulip.com/forums/showthread.php?t=10440

Thank god congress is looking after the financial stability of our blessed country so well.:mad:

We are mightily pleased to have such an impartial and clear headed thinker as Ben Benanke at the helm of the Fed!

[WDCRob]

Re: ECB warns US may lose AAA rating

That's good.

[nero3]

Re: ECB warns US may lose AAA rating

We are mightily pleased to have such an impartial and clear headed thinker as Ben Benanke at the helm of the Fed!

It appears that their model, that takes the output gap into account, should mean that there will be very low inflation. last time the output gap was like this was in 1982. I wonder if there can be a deflationary boom, despite all the hype about inflation.

[FRED]

Re: ECB warns US may lose AAA rating

It appears that their model, that takes the output gap into account, should mean that there will be very low inflation. last time the output gap was like this was in 1982. I wonder if there can be a deflationary boom, despite all the hype about inflation.

Recommend you read some of the material on this site to understand the situation better. For starters, the Fed created a deflationary boom on purpose starting in the late 1970s by raising interest rates to put the economy into a deflationary recession that was in full swing in 1982. The situation today is not even remotely similar.