what happens if we default???

#1
J

joevol320

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#1
i know we supposedly lose our aaa rating, our interest rates goes up.

that being said, wouldn't it help our dollar if we have to pay more interest?

right now we're printing so much money, our dollar is worthless. would this help our dollar?
 
#2
#2
zero chance we default. moderate chance of losing AAA. interest rates lowest in 40 years TODAY.
 
#3
#3
is there really much of a possibility we maintain AAA? I didn't think we were close to reaching some of the goals set my the rating agencies
 
#5
#5
we won't. but our biggest creditor is China. They have an AA- rating, so it's not like they can make too much of a stink about it.

And people are still flocking to treasuries. Why do you think that is?
 
#6
#6
utvolpj said:
is there really much of a possibility we maintain AAA? I didn't think we were close to reaching some of the goals set my the rating agencies
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the other countries at AA are not the united states of america with our tax base, economy, and earning power. they might downgrade us, but it would be ridiculous IMO. we are still the best credit in the world.
 
#8
#8
joevol320 said:
compared to the world's currencies for one. inflation is happening already with gas and food and I read that other products will start feeling inflation very soon.
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compared to say the russian debt crisis our currency is pretty stable.
 
#10
#10
no, but the point stands. yes the dollar constantly dropping isn't great, but it's hardly the end of the world.
 
#11
#11
i believe you are penalized 10 yards from the spot of the foul and you repeat the down.

that may not be correct. but, if it were a multiple choice test and were answer choice "B", 50% of the country would probably agree.

just sayin
 
#13
#13
my worries are with Money Market Funds, and Muni bonds in states that rely heavily on SS or Welfare. Those will be downgraded.
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#15
#15
99gator said:
i believe you are penalized 10 yards from the spot of the foul and you repeat the down.

that may not be correct. but, if it were a multiple choice test and were answer choice "B", 50% of the country would probably agree.

just sayin
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gator, i don't think this website is hiring for yard workers. were you looking for the florida unemployment website?
 
#16
#16
droski said:
zero chance we default. moderate chance of losing AAA. interest rates lowest in 40 years TODAY.
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You act as if that's a natural reflection of what's going on with our economy. Maybe that wasn't your intention. It should be made clear to everyone that interest rates are low because the Fed has artificially pegged them there.

Just like "prices" indicate when to buy and sell, interest rates indicate when to borrow and when to save. When government sets prices it undermines the natural flow of the economy and we'll end up with surpluses or deficits and inevitably waste. When government sets interest rates it manipulates the economy into saving or borrowing too much and it causes bubbles or stagnancy.
 
#19
#19
nbakerld said:
You act as if that's a natural reflection of what's going on with our economy. Maybe that wasn't your intention. It should be made clear to everyone that interest rates are low because the Fed has artificially pegged them there.

Just like "prices" indicate when to buy and sell, interest rates indicate when to borrow and when to save. When government sets prices it undermines the natural flow of the economy and we'll end up with surpluses or deficits and inevitably waste. When government sets interest rates it manipulates the economy into saving or borrowing too much and it causes bubbles or stagnancy.
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if people were legitimately afraid of a default the fed would not be able to peg them this low.
 
#21
#21
volinbham said:
wouldn't MM funds benefit from an increase in interest rates?
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yes, but if people are pulling money from the fund in billions (which is already happening) and the funds are forced to sell to meet redemptions and rates are up and therefore they have to sell at a loss some funds may break the dollar. i imagine the fed woudl step in and fix it, like they did on 08, but it could be a problem.
 
#22
#22
joevol320 said:
compared to the world's currencies for one. inflation is happening already with gas and food and I read that other products will start feeling inflation very soon.
Click to expand...

"Inflation" describes an increase in money supply, not increases in prices to individual products. An "inflated" price usually indicates an unjustifiably high price (because of speculation or subsidization, etc.) and people confuse that with the notion of "inflation".

Inflation is always happening. We usually have a steady rate of it, and then we spike it from time to time.
 
#24
#24
nbakerld said:
OK. Did you mean to address that to me?
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yes. rates are down today because of gdp fears. if anything people being afraid of washington makes them buy treasuries. makes no sense i know, but that seems to be the way it works.
 
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