US markets to crash on tuesday ?

[TW]Fox;19682957 said:
They won't default or be downgraded. They'll extend the ceiling yet again.
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Whilst it is highly unlikely they'd default it is entirely plausible that they will be downgraded. You certainly can't state with any degree of certainty that they won't. I'd go as far as saying that it is more than likely that at least one ratings agency does downgrade them to AA.
 
The_Abyss said:
Rating agency classifications don't really affect institutional investing which is what matters.
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they can do

If a PM is limited to only holding securities above a certain rating then downgrades can prompt sell offs. (Obv not necessarily applicable here.)
 
so in a foreseen shifty manner, the ceiling is raised and they can pay their bills.

does anyone have any idea just what the us has been up to to get like this?
 
How we got here? Two words: 'Tea' and 'Party'

While we were all laughing at the likes of Sarah Palin, they were gaining momentum. That is, after all, why she got on the ticket in the first place.

The US bipartisan system is just that, and since so many US voters vote for the name of the party, not for the person or the policy, we end up with the Tea Party. While their manifesto might be impossible hogwash (try combining 'small Government' with 'no job losses'), they got momentum almost by default (granted, many Americans do actually believe in this stuff), and now they're flexing that by demanding a balanced budget by constitutional decree, with few clues and no plan as to how to get there.

Think right-of-Tory policy with someone from the Monster Raving Loony party in charge, and you won't be far wrong.
 
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but how does a country like the us get this far down this road? have plenty of heads been rolling in the background over faults that the public will never know?

there's something really sneaky and shifty about this, especially in this day and age.
 
The US takes back-room politics to a whole new level. There's a huge lobbying machine over there with billions of dollars involved. The gun lobby is an obvious example. So yes, 'sneaky' and 'shifty' fit quite well.
 
Looking at the market, a few big playing companies gone down by 15% - 20%. Could be a good time to buy or wait for further decline?
 
So then does this mean that if America doesn't lose it's AA status tomorrow this bloke have lost 1 billion?
 
cm1179 said:
but how does a country like the us get this far down this road?
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Simply spending more than it takes in. Like you said thousands of lobbyists grabbing pieces of the pie. And you're wrong about the gun lobby they don't lobby for subsidies and contracts, they lobby solely to preserve rights and prevent new regulations. If gun makers were getting $8 billion a year in subsidies like farmers do you'd have a point.
 
Tefal said:
So then does this mean that if America doesn't lose it's AA status tomorrow this bloke have lost 1 billion?
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If that's indeed what the bet was.

The odds of AAA status going was absolutely minuscule and so I don't understand how such a large position could have been taken even by a collection of institutions. The possible payout would have been massive.

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Reading the article I see that the bet was completely different. The possible payout wouldn't have been anywhere near as big (nor the gains).

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Well i suppose even if it was a massive OTC bet, the banks could charge a fee which would be greater than the cost to them of properly hedging the risk? in which case you could get them to do it.
 
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ghost101 said:
If that's indeed what the bet was.

The odds of AAA status going was absolutely minuscule and so I don't understand how such a large position could have been taken even by a collection of institutions. The possible payout would have been massive.
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maybe bill gates got drunk?
 
Anyone who thinks the market is coming back up in the long haul is smoking crack. It was only at that level from government debt, consumer debt, then later QE1 and QE2 (and maybe QE3).

Couple the de-leveraging of the economy with the demographic changes over the next few decades and it's no-win situation. You really think millions of illiterate mexican immigrants can keep this thing running at current levels?

http://blog.chron.com/texaspolitics/2011/02/texas-demographer-its-basically-over-for-anglos/

Of the state’s 254 counties, 79 recorded declining population during the past 20 years. All are rural. An additional 30 Texas counties, he said, would have also lost population had they not experienced Hispanic growth.

The state’s future looks bleak assuming the current trend line does not change because education and income levels for Hispanics lag considerably behind Anglos, he said.

Unless the trend line changes, 30 percent of the state’s labor force will not have even a high school diploma by 2040, he said. And the average household income will be about $6,500 lower than it was in 2000. That figure is not inflation adjusted so it will be worse than what it sounds.
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Now with education cuts and everything else that are inevitable do you think the government can seriously catch these third world immigrants up to the current "Anglo" (who will soon be a minority) productivity/creativity level? Third world people (and dare I say IQs) = third world economy.

Then on top of that add all the entitlement-minded white-privilege baby-boomers who have to be supported. The economy is ******.
 
I love the idea that they put triggers into the agreement to cut social and defence spending just to force the two parties back to the table to hammer out a deal by December. Its a ridiculous state of affairs that they would need to do something like that just to get the leaders of the country to play together.
 
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