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October 17, 2013

Chinese ratings agency gets what Obama administration fails to grasp

Topics: Political News and commentaries

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AFP reports that the Chinese ratings agency Dagong has downgraded its US sovereign credit rating despite Washington's resolution of the debt ceiling deadlock, warning that fundamentals for a potential default remained "unchanged" ... and the details speak volumes about what the GOP has been arguing all along:

"The fundamental situation that the debt growth rate significantly outpaces that of fiscal income and gross domestic product remains unchanged," ... adding Washington's solvency was vulnerable as old debts were still repaid through raising new debts.

"Hence the government is still approaching the verge of default crisis, a situation that cannot be substantially alleviated in the foreseeable future," it said. ...

More here.

Dagong is certainly not a big player as far as credit rating agencies go, but nonetheless its argument for its downgrade of the U.S. rating is solid. What Obama and his fellow Democrats, along with some establishment Republicans, is completely unsustainable as every responsible citizen knows - you can't just keep spending more than you have coming in and keep piling on new debt to pay for old debt. Doing so can only have one end result ... insolvency.

Related: 5 Things That Will Happen To You When America Goes Bankrupt.

Posted by Hyscience at October 17, 2013 9:43 AM

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