How can Geithner be so adamant?

""Treasury Secretary Timothy Geithner [[GYT'-nur) says the U.S. government "will never" lose its sterling credit rating despite big budget deficits and a newly increased debt limit that now tops $14 trillion.
Geithner says in an interview broadcast Sunday that in times of economic crisis, international investors will continue to buy U.S. Treasury bonds because the bonds are a safe investment.
Moody's Investors Service recently issued a warning that the government's credit rating could eventually be in jeopardy if nation's finances don't improve. The cost of borrowing would increase significantly if the ratings service lowered the credit rating, also known as a bond rating, for U.S. Treasuries.""


http://abcnews.go.com/Business/wireStory?id=9770300

This guy is beginning to remind me of that Iraq defense minister. "There are no US troops in Iraq" "We are attacking the US now even as we speak"...

Us will never lose it's credit rating? If the foreign markets decide to dump our dollar and opt for the euro instead, which is quite possible, It CAN happen. We're 12 trillion in debt and living on foreign money, but we're a safe credit risk. This guy is nothing but a liar. And his lies will serve only to dig the hole deeper for us.

The question should be "How can Geithner be so stupid?"

It won't be long before Timmy's out on his a** and he has to sing for his supper:

"Check it out our debt ceiling's blowin up sky high,
Ditched my tax problems and got on board Obama's ride,
Now everyone's rollin Euro-friendly and the dollar's lookin bad,
When the Chinese saw our FICO score they said, “This was all they had,”
I’m singin,
F to the R to the E to the E,
To the C to the R to the E D I T,
RE to the PORT to the DOT to the COM,
Come on everybody, bend over and grab your ankles, sing along it’s easy…"

[apologies to FCRdotcom]

Let's presume China and Japan stop buying American securities in favor of the Euro. Who do they propose is going to buy their manufactured goods?

As long as Americans are stupid enough to continue paying their taxes, the government can continue to issue debt.

Taxed Enough Already?

There must have been a memo sent out to down play the effects of the proposed budget. Robert Reich and Paul Krugman both wrote op-ed pieces stating that the planned spending wasn't big enough.

Ghetto, China will continue to buy our bonds. At their request, the US has been issuing far greater amounts of TIPS [[inflation protected securities). If we experience inflation, the interest payments on those bonds is increased [[I think they increase the outstanding principal amount commensurate with the CPI increase and then pay interest on the higher amount).

Quote:

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Originally Posted by jiminnm

There must have been a memo sent out to down play the effects of the proposed budget. Robert Reich and Paul Krugman both wrote op-ed pieces stating that the planned spending wasn't big enough.

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Krugman has been saying as much for well over a year.

Perhaps Mr. Krugman and Robert Reich should go to China to explain how doing more of what got us into a mess will now make it better. I mean, those Chinese students were so disrespectful to Timmy. Certainly they will believe Robert Reich and Paul Krugman. At worst, such a traveling Keynesian clown act would at least make these impudent Chinese students understand that Americans are capable of humor.

"In his first official visit to China since becoming Treasury Secretary, Mr Geithner told politicians and academics in Beijing that he still supports a strong US dollar, and insisted that the trillions of dollars of Chinese investments would not be unduly damaged by the economic crisis. Speaking at Peking University, Mr Geithner said: "Chinese assets are very safe."

The comment provoked loud laughter from the audience of students."

http://www.telegraph.co.uk/finance/f...-are-safe.html 1/1/09

O'dub,

Re: those Chinese students, sounds as though we need to win their hearts and minds. They will be our friend.

These guys thought they could just print money too.....

http://news.bbc.co.uk/2/hi/business/4765187.stm

Imagine it taking this pile of money...
http://roundmoney.com/Business/Dolll...e-of-money.png
To buy one loaf of bread....