BREAKING: US Loses AAA Credit Rating from S&P

[KC]

United States loses AAA credit rating from S&P

Aug 5 (Reuters) - The United States lost its top-notch AAA credit rating from Standard & Poor's on Friday, in a dramatic reversal of fortune for the world's largest economy (http://www.reuters.com/finance/economy).

S&P cut the long-term U.S. credit rating by one notch to AA-plus on concerns about growing budget deficits.

U.S. Treasuries, once undisputedly seen as the safest investment in the world, are now rated lower than bonds issued by countries such as the UK, Germany, France (http://www.reuters.com/places/france) or Canada.

The outlook on the new U.S. credit rating is negative, S&P said in a statement, a sign that another downgrade is possible in the next 12 to 18 months. (Reporting by Walter Brandimarte (http://blogs.reuters.com/search/journalist.php?edition=us&n=walter.brandimarte&); Editing by Jan Paschal (http://blogs.reuters.com/search/journalist.php?edition=us&n=jan.paschal&))

Source (http://www.reuters.com/article/2011/08/06/usa-downgrade-sp-idUSN1E7741TJ20110806)

[KC]

The full report from Standard & Poor's can be found here (http://www.standardandpoors.com/servlet/BlobServer?blobheadername3=MDT-Type&blobcol=urldata&blobtable=MungoBlobs&blobheadervalue2=inline%3B+filename%3DUS_Downgrade d_AA%2B.pdf&blobheadername2=Content-Disposition&blobheadervalue1=application%2Fpdf&blobkey=id&blobheadername1=content-type&blobwhere=1243942957443&blobheadervalue3=UTF-8) (it's 8 pages long, I suggest you read it). From the report:


Overview
· We have lowered our long-term sovereign credit rating on the United
States of America to 'AA+' from 'AAA' and affirmed the 'A-1+' short-term
rating.

· We have also removed both the short- and long-term ratings from
CreditWatch negative.

· The downgrade reflects our opinion that the fiscal consolidation plan
that Congress and the Administration recently agreed to falls short of
what, in our view, would be necessary to stabilize the government's
medium-term debt dynamics.

· More broadly, the downgrade reflects our view that the effectiveness,
stability, and predictability of American policymaking and political
institutions have weakened at a time of ongoing fiscal and economic
challenges to a degree more than we envisioned when we assigned a
negative outlook to the rating on April 18, 2011.

· Since then, we have changed our view of the difficulties in bridging the
gulf between the political parties over fiscal policy, which makes us
pessimistic about the capacity of Congress and the Administration to be
able to leverage their agreement this week into a broader fiscal
consolidation plan that stabilizes the government's debt dynamics any
time soon.

· The outlook on the long-term rating is negative. We could lower the
long-term rating to 'AA' within the next two years if we see that less
reduction in spending than agreed to, higher interest rates, or new
fiscal pressures during the period result in a higher general government
debt trajectory than we currently assume in our base case.Emphasis mine.

[Sensible Socialist]

Burn the U.S. economy to the ground.

[HEAD ICE]

owned

[Feodor Augustus]

There's going to be one hell of a run on the dollar.

[KC]

Burn the U.S. economy to the ground.


owned

Because LOL it's so funny that interest rates are going to rise, meaning that consumer debt is going to rise as well while public assistance programs are cut and millions of hardworking American people are going to have the rug pulled out from under them and be buried in debt they can't pay back.

Fuck. You.

[AnonymousOne]

US markets have worst week since recession

http://news.ninemsn.com.au/article.aspx?id=8282138

Mmmm, delicious.

[HEAD ICE]

Because LOL it's so funny that interest rates are going to rise, meaning that consumer debt is going to rise as well while public assistance programs are cut and millions of hardworking American people are going to have the rug pulled out from under them and be buried in debt they can't pay back.

Fuck. You.


the bolded words really show how angry you are

[KC]

US markets have worst week since recession

http://news.ninemsn.com.au/article.aspx?id=8282138 (http://www.anonym.to/?http://news.ninemsn.com.au/article.aspx?id=8282138)

Mmmm, delicious.

Because working people's retirement plans getting gutted due to the market decline is so fucking delicious.

Fuck you too!

[Broletariat]

Because working people's retirement plans getting gutted due to the market decline is so fucking delicious.

Fuck you too!

K bro, we understand, when the rich get fucked so do the poor.

But uhm..

The rich are getting fucked right now aren't they? like, instead of getting off scot free like usual? That's kind of cool right?

[AnonymousOne]

Because working people's retirement plans getting gutted due to the market decline is so fucking delicious.

Fuck you too!

U mad bro?

I'm not saying workers retirement plans getting owned is "delicious" I'm saying watching the capitalists squirm in the market is. I think it's damn funny.

[KC]

I'm not saying workers retirement plans getting owned is "delicious" I'm saying watching the capitalists squirm in the market is. I think it's damn funny.

I don't think it's "damn funny" to watch my 401(k) go down the tubes, do you?

Perhaps you're not in a situation where you're affected by this and can sit on the sidelines and laugh.

[AnonymousOne]

I don't think it's "damn funny" to watch my 401(k) go down the tubes, do you?

Perhaps you're not in a situation where you're affected by this and can sit on the sidelines and laugh.

I have an Irrevocable Trust for this very reason, fuck the markets, but no I don't think it's funny you're getting fucked over. Calm the fuck down, I said it was funny that capitalists were getting egg on their face.

You're acting hysterical.

[KC]

I have an Irrevocable Trust for this very reason, fuck the markets, but no I don't think it's funny you're getting fucked over. Calm the fuck down, I said it was funny that capitalists were getting egg on their face.

People are getting put out on the streets and you think it's funny that rich people are not as rich, and you think I'm hysterical?

[heirofstalin]

ECONOMIC TERRORISM

if the americans still had a functioning government they would have arrested standard and poor workers like the italians did the other day.

[HEAD ICE]

thank you for telling me that the working class in america is getting fucked over. being a working class american i had no idea shit was getting bad. just to think i was going to gold plate my yacht this weekend.

[Pretty Flaco]

This has much less of an effect on the people who are rich than those who aren't.

Just throwing that no brainer information out there to the folks that think this is in any way a laughing matter.

[heirofstalin]

Paul Krugman writes on his blog:

OK, so Standard and Poors has gone ahead with the threatened downgrade. It’s a strange situation.

On one hand, there is a case to be made that the madness of the right has made America a fundamentally unsound nation. And yes, it is the madness of the right: if not for the extremism of anti-tax Republicans, we would have no trouble reaching an agreement that would ensure long-run solvency.

On the other hand, it’s hard to think of anyone less qualified to pass judgment on America than the rating agencies. The people who rated subprime-backed securities are now declaring that they are the judges of fiscal policy? Really?

Just to make it perfect, it turns out that S&P got the math wrong by $2 trillion, and after much discussion conceded the point — then went ahead with the downgrade.

More than that, everything I’ve heard about S&P’s demands suggests that it’s talking nonsense about the US fiscal situation. The agency has suggested that the downgrade depended on the size of agreed deficit reduction over the next decade, with $4 trillion apparently the magic number. Yet US solvency depends hardly at all on what happens in the near or even medium term: an extra trillion in debt adds only a fraction of a percent of GDP to future interest costs, so a couple of trillion more or less barely signifies in the long term. What matters is the longer-term prospect, which in turn mainly depends on health care costs.

So what was S&P even talking about? Presumably they had some theory that restraint now is an indicator of the future — but there’s no good reason to believe that theory, and for sure S&P has no authority to make that kind of vague political judgment.

In short, S&P is just making stuff up — and after the mortgage debacle, they really don’t have that right.

So this is an outrage — not because America is A-OK, but because these people are in no position to pass judgment.

[Leonid Brozhnev]

When times are tough, people radicalise. I guess it's hard to tell whether people will go to the left or the right in the US... a centuries worth of anti-communist/socialist propaganda will be hard to shake off for the majority of the population. I don't expect much 'good' to come of this i.e revolution... just a lot of poor people becoming poorer, a lot of employed people becoming unemployed and, of course the obligatory rich bastard making billions off the broken back of working class.

[Pretty Flaco]

When times are tough, people radicalise. I guess it's hard to tell whether people will go to the left or the right in the US... a centuries worth of anti-communist/socialist propaganda will be hard to shake off for the majority of the population. I don't expect much 'good' to come of this i.e revolution... just a lot of poor people becoming poorer, a lot of employed people becoming unemployed and, of course the obligatory rich bastard making billions off the broken back of working class.

That "make things as bad as possible for people to radicalize them" bullshit ain't so great for those of us that aren't sitting in a cushy little position in life.

[AnonymousOne]

People are getting put out on the streets and you think it's funny that rich people are not as rich, and you think I'm hysterical?

Yep. You found me out, I laugh when poor people suffer. That's clearly why I'm on the RevLeft forum. :rolleyes:

As opposed to you know, seeing the global capitalist system in throes.

[KC]

Paul Krugman writes on his blog:

OK, so Standard and Poors has gone ahead with the threatened downgrade. It’s a strange situation.

On one hand, there is a case to be made that the madness of the right has made America a fundamentally unsound nation. And yes, it is the madness of the right: if not for the extremism of anti-tax Republicans, we would have no trouble reaching an agreement that would ensure long-run solvency.

On the other hand, it’s hard to think of anyone less qualified to pass judgment on America than the rating agencies. The people who rated subprime-backed securities are now declaring that they are the judges of fiscal policy? Really?

Just to make it perfect, it turns out that S&P got the math wrong by $2 trillion, and after much discussion conceded the point — then went ahead with the downgrade.

More than that, everything I’ve heard about S&P’s demands suggests that it’s talking nonsense about the US fiscal situation. The agency has suggested that the downgrade depended on the size of agreed deficit reduction over the next decade, with $4 trillion apparently the magic number. Yet US solvency depends hardly at all on what happens in the near or even medium term: an extra trillion in debt adds only a fraction of a percent of GDP to future interest costs, so a couple of trillion more or less barely signifies in the long term. What matters is the longer-term prospect, which in turn mainly depends on health care costs.

So what was S&P even talking about? Presumably they had some theory that restraint now is an indicator of the future — but there’s no good reason to believe that theory, and for sure S&P has no authority to make that kind of vague political judgment.

In short, S&P is just making stuff up — and after the mortgage debacle, they really don’t have that right.

So this is an outrage — not because America is A-OK, but because these people are in no position to pass judgment.

Too bad Krugman isn't a rating agency so all his whining doesn't even matter.


As opposed to you know, seeing the global capitalist system in throes.

The only reason that one could laugh is because this doesn't affect them or their associates.

Because, damn dude, people are getting kicked out of their homes onto the street and losing their jobs and getting buried in debt, but man isn't it funny that Bill Gates might not be able to donate as much money to charity this year?

See, unlike your straw man above (I never claimed you laugh at poor people suffering), I'm responding directly to what you're laughing at. The fact that you can focus on rich people losing a relative pittance when people's lives are being ruined is very telling.

[#FF0000]

Yep. You found me out, I laugh when poor people suffer. That's clearly why I'm on the RevLeft forum. :rolleyes:

As opposed to you know, seeing the global capitalist system in throes.

Uh bro this is just another crisis. capitalism's on its death bed right now. it's not as if there's a militant and powerful working class movement anywhere on the planet while this is happening

[Lenina Rosenweg]

Because, damn dude, people are getting kicked out of their homes onto the street and losing their jobs and getting buried in debt,

I soon may be one of them.

[heirofstalin]

you must be either stupid or rich to think this is a good situation, s&p holding a gun to americas head demanding cuts to the poor. this will only benefit the top %1

but dont worry, this might just make people even angrier and lead to a french revolution.
SOCIALISM IN AMERICA!!!

[AnonymousOne]

Because, damn dude, people are getting kicked out of their homes onto the street and losing their jobs and getting buried in debt, but man isn't it funny that Bill Gates might not be able to donate as much money to charity this year?

It's ironic, tbh. Here there was this big desperate grand sweeping action of the bourgeoisie to come up with a deal and save the financial system and U.S credit ratings. They come up with a deal (just in time!) to prevent the big default.

And it's all for nothing. U.S credit is devalued and markets are thrown into chaos.

To quote Nietzsche, "Perhaps I know best why it is man alone who laughs; he alone suffers so deeply that he had to invent laughter."

[HEAD ICE]

That "make things as bad as possible for people to radicalize them" bullshit ain't so great for those of us that aren't sitting in a cushy little position in life.

that is kind of the point. capitalism since 1970 has been in an extended crisis that it has never resolved, that being of an overaccumulation of capital and a falling rate of profit, and to make the system not collapse entirely debt has been thrown over the problem. that isn't going to cut it. the only way capital can sustain itself is a large scale destruction of capital values, and the greater intensity of the crisis will lead to greater imperialist intensity which will result in a third world war and possibly the end of humanity.

this downgrade sucks, as KC The Only Worker in America™ is letting us know. the reason why communism is an alternative is not because it is a better idea but because it is the only way humanity can fulfill their needs. capitalism obviously can not do that. the working class buries capitalism because they have to.

either we can continue doing what the left has been doing and trying to save capitalism or attempt to ossify an independent class movement against capital that is for its overthrow and for communism.

socialism or barbarism

[KC]

It's ironic, tbh. Here there was this big desperate grand sweeping action of the bourgeoisie

The US government isn't "the bourgeoisie".


to come up with a deal and save the financial system and U.S credit ratings. They come up with a deal (just in time!) to prevent the big default.

And it's all for nothing. U.S credit is devalued and markets are thrown into chaos.

There are many more reasons behind this that you're not even realizing.


To quote Nietzsche, "Perhaps I know best why it is man alone who laughs; he alone suffers so deeply that he had to invent laughter."

The fact that you're quoting this douchebag is even more telling.

[Leonid Brozhnev]

That "make things as bad as possible for people to radicalize them" bullshit ain't so great for those of us that aren't sitting in a cushy little position in life.

I'm sure I didn't advocate making things worse for the working class in order to radicalise them, i'm sorry if it sounded like that.

[heirofstalin]

I soon may be one of them.

youve got my sympathies.

[Madslatter]

S&P and Moody's are pathetic agencies, but is this whole downgrade really a surprise? I should hope that a number of us thought it was likely to come considering how this country is looking. Don't expect a retirement that is in stocks to do well over the next couple of months because things are looking really sketchy.

More importantly I think we need to use this TO radicalize people, and maybe make something good come out of it. This weekend your friends are going to be *****ing about this and monday morning coworkers will be mad. What better time to hammer in some points about how shitty capitalism is.

[heirofstalin]

I think this is the second stage of the widespread looting of our national treasuries. this is by no means accidental. it was done purposely by the banks and corporates to defraud us of more trillions in a "bailout" (translated to theft of public funds) these politicians knew exactly what they were doing in this carefully crafted piece of theatre where they pretended to argue over the issues, when they were secretely reporting to their corporate masters the night before.

[RadioRaheem84]

The only reason why I am taking the downgrade seriously is because the people who own the economy do. Other than that, this is all manufactured to break the back of the working class.

[KC]

Other than that, this is all manufactured to break the back of the working class.

This is what is known as the "capitalism is a conspiracy" nonsense. I generally don't even respond to it because of how ridiculous it is to claim that capitalism is one giant conspiracy of "the bourgeoisie" to exploit "the workers" but I just figured I'd point it out here because I'm sick of seeing this crap all over the board.

[Die Neue Zeit]

The rhetoric of neoliberalism being "one giant conspiracy," particular by big and small business associations (Chambers of Commerce, Federations of Small Businesses, etc.) is a good one. Agitation must be tailored from the most politically aware workers to the least politically aware ones, and must not be above getting past cheap sloganeering and resorting to conspiracy-theory-based agitation for the latter.

[RadioRaheem84]

What are you talking about KC and why are you so f-ing pissed off all the time?

I never meant it to mean that it is a "conspiracy", but capitalists are just acting in their own interest.

I'm confused, are you mocking the use of terms bourgeoisie and workers?

Just what do you believe is happening? I just think this is the normal mechanism of capitalism. Workers have to tighten their belts not capitalists.

So austerity is a conspiracy?

[o well this is ok I guess]

The fact that you're quoting this douchebag is even more telling. .___________________________________________.

[bcbm]

The rich are getting fucked right now aren't they? like, instead of getting off scot free like usual? That's kind of cool right?

no they have been making record profits since the recession started and something like this might cut into their profit a little but it hardly hurts them in the same way it hurts the poor. they are going to get away scot free and still make a mint while millions are going to be pushed into further misery.

[Broletariat]

no they have been making record profits since the recession started and something like this might cut into their profit a little but it hardly hurts them in the same way it hurts the poor. they are going to get away scot free and still make a mint while millions are going to be pushed into further misery.

Then I guess the media tricked me again.

Dammit.

[Sensible Socialist]

I leave for a few hours and it's heating up in here. I'll clarify my former comments, which weren't the most eloquent words ever typed. The fact of the matter is the working class is getting fucked every single day. Millions of people are dying because of capitalism, and the ones that manage to survive live in misery. Conditions are not pretty. And they will never be under capitalism. Do I want social programs to be cut? No, which is why we fight against that. Do I want the working class to be shafted even more? No, which I why we fight against that. But the fact of the matter is things will get worse before they get better. I'm not an ivy tower intellectual (like some here); I'm feeling the pain of the reccession like almost every other poster on this board (save for the occasional trust fund revolutionary). I have no illusions, however, about somehow salvaging the U.S. economy while we prepare to revolt against the government and capitalism. It won't be pretty. Workers are getting the short end of the stick as they have been since the inception of capitalism. We need to continue fighting against cuts, but the fact stands: the capitalist U.S. economy must be dismantled.

[Rusty Shackleford]

two points.

1: i went on my lunch hour(really 30 min) and got in my car and turned to NPR. it was 6pm and i was just expecting soem regualr boring bullshit. what it turned out to be was "live ongoing coverage on the US credit rating"

when i head "Standard & Poor Downgrades US Credit Rating" i literally had a reflex reaction. i cheered immediately and i was pretty excited.

2: fuck! this shit is going to get harder. Still only have one job and still having troubles with rent. :(

[ComradePonov]

interests are probably going to rise for average Americas. I don't actually think this is as big as a deal as China and Germany downgrading the US credit rating, which they already did.

I think China and Germany downgrading the US credit rating was a far bigger story than this. The media's fascination with this story dazzles me, as the downgrading of the US credit rating by the 2nd and 3rd largest economies is/was a far greater event. It also had and will have a bigger impact on the grand scheme of things, including the overall interests of the average American worker.

Either way, I think its safe to say, the rich get slightly less rich while the workers get poorer and poorer. It is amazing to see corporations take in record profits, and at the same time see the US economy stuck at 9.2% unemployment.

I live in Canada, but I still sympathize with all those who will be effected.

[Rocky Rococo]

Ah, I see the hopey changey squad has joined us to point out that the the fate of all workers is tied up in the triumph of capitalist accumulation and the further enrichment of the "job creators" of the "financial community". Got it.

I quit dailykos, why is it following me here?

[CHE with an AK]

http://i83.photobucket.com/albums/j318/Tredcrow/2011/latuffmarx.jpg

[PC LOAD LETTER]

This shit just got real.

[tanklv]

no they have been making record profits since the recession started and something like this might cut into their profit a little but it hardly hurts them in the same way it hurts the poor. they are going to get away scot free and still make a mint while millions are going to be pushed into further misery.

Exactly. You do know that at least one repuke - Eric Cantor - is BETTING on "short selling" - IOW - that the US will default/be downgraded - and as a result - he and many others like him - WILL MAKE A FORTUNE ON THE REST OF OUR MISERY!

And I bet most all of the other repukes and DINOS are doing THE SAME THING!!!

In any other universe - he'd be arrested and charged with being a TRAITOR for BETTING AGAINST THE WELFARE OF HIS OWN COUNTRY!!!

But even tho this has been pointed out in at least a few media outlets, nobody has heard of it and the rest have refused to report it - so this criminal will get away scott free!!!

[ZeroNowhere]

"Though my own financial distress may be dire indeed, never, since 1849, have I felt so cosy as during this outbreak."

In any case, it was going to happen anyway, eventually. I don't think that the state of falling down is really much to be glorified over that of hitting the ground.


That "make things as bad as possible for people to radicalize them" bullshit ain't so great for those of us that aren't sitting in a cushy little position in life.Of course, I'm sorry, in actual fact the conditions of the proletariat are going to improve consistently and rapidly, but nonetheless they will revolt because our propaganda is so persuasive.

[#FF0000]

Of course, I'm sorry, in actual fact the conditions of the proletariat are going to improve consistently and rapidly, but nonetheless they will revolt because our propaganda is so persuasive.

I guess that's why the entire third world is in the midst of a communist revolution

[#FF0000]

Ah, I see the hopey changey squad has joined us to point out that the the fate of all workers is tied up in the triumph of capitalist accumulation and the further enrichment of the "job creators" of the "financial community". Got it.

I quit dailykos, why is it following me here?

that's not what they're saying actually. People are saying that for the rich, this doesn't mean much of anything. Some analysts don't even think it'll hurt the stock market all that much

but holy shit don't let any of that get in the way of your being a douchebag.

[Tablo]

Serious question here. What does it really mean that the US credit rating has gone down? The US news stations have been depicting it as some kind of apocalypse, but what does it in real serious materialist terms mean for the bourgeoisie and the proletariat? Should I be freaking out and hoping I'm still able to pay for school? Will I be homeless in a year? I'm not so sure what to really believe.

[Jose Gracchus]

In immediate direct impact, it will make the cost to the U.S. government of financing its debts higher, since loans demand higher interest with greater risk.

In broader terms, since the United States unilaterally withdrew from the Bretton Woods system, the U.S. dollar has become the de facto world reserve currency, since U.S. credit was judged the gold standard of secure investments. All the world's private banks and financial institutions and central banks have just been informed that all the U.S. treasuries they have stockpiled are now considered by a consensus to be less secure. We are seeing the beginnings of a macrohistorical economic event, whose ramifications ultimately we can only guess at. The U.S. as a global hegemon has been in economic decline since the 1970s, along with world capitalism, but there's been a failure to achieve a decisive recomposition (to the extent there was after the thirty years of disorder and destruction of 1914-1945) on the basis of which a suitable rate of real profits can be maintained for a new period of expansion. This, combined with the possible UN recognition of Palestine come September, are bellwether events which signal that the eclipse of the U.S. as preeminent hegemon by multipolarity has arrived. This will likely lead to greater inter-imperialist strife than previously.

[Tommy4ever]

Wow, this is pretty fucking huge.

[Blackscare]

Exactly. You do know that at least one repuke - Eric Cantor - is BETTING on "short selling" - IOW - that the US will default/be downgraded - and as a result - he and many others like him - WILL MAKE A FORTUNE ON THE REST OF OUR MISERY!

And I bet most all of the other repukes and DINOS are doing THE SAME THING!!!

In any other universe - he'd be arrested and charged with being a TRAITOR for BETTING AGAINST THE WELFARE OF HIS OWN COUNTRY!!!

But even tho this has been pointed out in at least a few media outlets, nobody has heard of it and the rest have refused to report it - so this criminal will get away scott free!!!

Short selling is actually standard practice in bear markets, it's what most day traders and heavy investors do. All it really means is capitalists find ways to make money when the stock market is up and have found ways to make money when it is down.


It does sort of represent a conflict of interest since it is actually against the economic self interest of these politicians to see the economy stronger (in the short term, short selling is not a long term strategy most of the time. When it is, look out). But there are so many other things to worry about in terms of conflicts of interests and such, this is not that important. Really it is just evidence that the capitalist class, which of course includes all or most of our politicians, is compelled to pursue profit in any way possible. Short selling represents a way of making profit in a bear market so they do it. Not very astounding at all. Unless you think in terms of "morals", but then you're so hopelessly lost I can't help you.

[Rusty Shackleford]

So, anyone wanna bet that the markets will open with a quick sell-off and then a stabilization in a few hours on monday? (lets be honest. this isnt the final nail in the coffin, this is not the straw that breaks the camels back... so they say)

that is, unless there is a revision to the S&P's rating or if moody's joins in. then it will be a jump or a mega drop.

The Inform Candidate is right about it being a macroeconomic world-historic event or whatever ( :lol: ). Well not just this but this last week. This year may be the year. Not even in the great depression was the US's credit rating dropped. Not in the 80s, 90s, or at the beginning of the current crisis. It happened NOW after the capitalist parties proved themselves to be infantile and unwilling to make any major move in any direction on the issue of the budget. obviously they didnt increase taxes but at the same time they didnt go all IMF crazy in cuts and privatization. they just made a tiny(in relation to the whole debt) cut (which is really just the primer for a major attack on reforms won in the last century).

With the Eurozone on the brink of full fledged financial chaos, the US ruling class basically being paralyzed, while the arab world is in the throes of struggle and some crazy ass natural disasters in east asia. not to mention the most severe drought in most of texas and an unrelenting heatwave(which is a threat to crops) in the midwest. Shit is going down.


Thursdays economic news was very interesting, but what came friday was like BAM. no other way to put it. just... BAM.

[Blackscare]

http://www.reuters.com/article/2011/08/06/china-us-idUSL3E7J602920110806



Apparently China just made a statement urging the adoption of a new world reserve currency, which would be absolutely disastrous for the US. Hell, the "currency basket" idea being bandied about before all this would have rocked our economy to the core, without the US dollar actually being "replaced" in the proper sense like they're apparently talking about.

[Delenda Carthago]

http://www.reuters.com/article/2011/08/06/china-us-idUSL3E7J602920110806



Apparently China just made a statement urging the adoption of a new world reserve currency, which would be absolutely disastrous for the US. Hell, the "currency basket" idea being bandied about before all this would have rocked our economy to the core, without the US dollar actually being "replaced" in the proper sense like they're apparently talking about.

The worst of it all, given the fact that rght now military is all USA has to count on, this is that I m afraid what the books of the future will tell people how WWIII started...

[Chicano Shamrock]

I know the poor will get poorer but isn't that what people thought would happen? If you think that this economic system can not sustain itself wouldn't you believe that everyone is going to go down with the rich?

I'm not saying the rich are going down right now or that anyone should rejoice. I am just asking a serious question.

[W1N5T0N]

thats the thing about capitalism...it's like a mad dog, which one day rips off his chain and comes back to bite you in the ass :ninja:

[Ligeia]

Some little bits of an article:


The agency's official commentary added:

China, the largest creditor of the world's sole superpower, has every right now to demand the United States to address its structural debt problems and ensure the safety of China's dollar assets.
[...]

Perhaps not surprisingly for China, which maintains a running, if sometime unspoken military competition with the United States, the commentary suggested that the giant Asian, loan-holding nation might be right to expect even further major reductions in U.S. defense spending to help pay off its existing debts to China. The article warned:

If no substantial cuts were made to the U.S. gigantic military expenditure and bloated social welfare costs, the downgrade would prove to be only a prelude to more devastating credit rating cuts, which will further roil the global financial markets.

Link (http://latimesblogs.latimes.com/washington/2011/08/china-demands-us-cure-its-debt-problems.html)

Anybody knows or suspects what will happen on Monday or simply next week? So talking about the immediate effects, what do you think does this mean? How will this affect world economy or will it only affect certain parts?

[Savage]

fuck

[RadioRaheem84]

In terms of an immediate effect on workers, what will this do?

I mean I am of the mindset that most of this is this is the irrational paradigm of the system and capitalists, that under this framework we have to take this seriously because capitalists and lawmakers do. But in reality there is an alternative and the alternative is socialism.

So the only thing making me uneasy is that capitalists and lawmakers are heavily ingrained into the logic of the system taking a discredited rating agency as gospel and using the opportunity to diminish living standards in order to have us pay for the outcome.

Does this sound about right, or is it too "conspiratorial"?

[Welshy]

One thing I have been wondering is that besides what people are asking its effect on workers, what effect will it have on the stock market since the stock market as we know over reacts frequently and was doing poorly recently?

Also, fuck. I smell more austerity and long term cuts.

[aty]

This is it, where we workers have to organize and resist in every way possible, this is no longer just fun and games. I genuinely believe that the start of the big battle of our generation have just begun.

[Luís Henrique]

So the only thing making me uneasy is that capitalists and lawmakers are heavily ingrained into the logic of the system taking a discredited rating agency as gospel and using the opportunity to diminish living standards in order to have us pay for the outcome.

Does this sound about right, or is it too "conspiratorial"?

It is too conspirational, but indeed it is weird to see subStandard and Miserable doing that. Those rates were supposed to guide first world investors on which third world countries are safer to invest. They now are telling first world investors that their own home is afire.

They are telling the truth, and truth is incompatible with a capitalist system.

Luís Henrique

[Luís Henrique]

This is it, where we workers have to organize and resist in every way possible, this is no longer just fun and games. I genuinely believe that the start of the big battle of our generation have just begun.

Indeed, we are going to live interesting times, and I don't say that as a good thing.

If this is the big battle, it is just such a pity that we are so lightly armed and our ranks stand in such a pitiful disarray.

Luís Henrique

[KC]

It is too conspirational, but indeed it is weird to see subStandard and Miserable doing that. Those rates were supposed to guide first world investors on which third world countries are safer to invest. They now are telling first world investors that they own home is afire.

They rate all kinds of investments, not just sovereign debt. The only reason nobody looked to them regarding first world debt is because of the fact that first world debt never changed from AAA historically.

[RadioRaheem84]

It is too conspirational, but indeed it is weird to see subStandard and Miserable doing that. Those rates were supposed to guide first world investors on which third world countries are safer to invest. They now are telling first world investors that their own home is afire.

They are telling the truth, and truth is incompatible with a capitalist system.

Luís Henrique

That's the thing though. How is it conspiratorial if their political framework does not allow them to nationalize or tax (higher) the private sector but instead devour or gut the public sector which in effect will lower our living standards?

How is it conspiratorial if the logic behind solving the crisis for the private sector is to raise interest rates, cut jobs, outsource, divest, lower wages, etc. which will turn also lower living standards?

It seems that both the political and the business class seem incapable of breaking the paradigm as the leftist solution has been been gutted from discourse.

That is all I was saying. How is it being too conspiratorial? I thought we were to refrain from looking at the system as some natural occurence and instead a social system where the only reason we take the crises stemming from capitalism seriously is because the bourgoise are in control, other than that it is one that can be changed.

It just seems like we're taking this seriously from the vantage point of the capitalists and not from the workers. I am only taking this seriously, because the capitalists and lawmakers do and will thus act according to their interests, which usually means more neo-liberalization, not because I actually think Standard and Poors has any real integrity.

[aty]

If this is the big battle, it is just such a pity that we are so lightly armed and our ranks stand in such a pitiful disarray.


Hear hear...


But I must say that in this time, we have all the arguments and analysis we need! This is the perfect time to put them forward. Not just talk about how we can "reform capitalism" to become a "better capitalism", but really challenge capitalism with an alternative economic system.

In these times common ownership of the means of production and a democratic economy dont sound to crazy any longer in the ears of the workers.

The workers are already starting to realise that the politicians, the capitalists, the bankers have fucked them. The right wing arguments in the right wing media cant be trusted anymore.

We just need to put our picture in the open for everyone to see.

Lets go to work. :marx:

[Martin Blank]

One thing I have been wondering is that besides what people are asking its effect on workers, what effect will it have on the stock market since the stock market as we know over reacts frequently and was doing poorly recently?

Also, fuck. I smell more austerity and long term cuts.

The stock markets are likely to be very volatile over the next three months (large swings in both directions, though generally trending down). The area to watch is the commodities market. There has been a speculative bubble growing in that area since 2009, and it is at or very near the bursting point. The downgrading may be the pin to the balloon, which would mean the collapse of staple food prices and the wiping out of small farmers (just after the recent debt talks led to the end of billions in subsidies to these very same farmers).

And, yes, there will definitely be more austerity, brought to us all courtesy of the new "Super Congress".

[Rusty Shackleford]

This isnt irrational what they are doing. sure, its chaotic. but it is a rule they made up when imperialism came along. With 1917 came about the US credit rating and then global credit ratings. There was a set list of rules for how credit was supposed to be handled in a more and more credit based economy.

If it does not abide by its own rules, then what makes capitalism legitimate? If S&P and Moody's just acted in the interests of their national and imperial bourgeoisie then the world markets would revolt.

something like this was in the David Harvey RSA video.

[S.Artesian]

Because LOL it's so funny that interest rates are going to rise, meaning that consumer debt is going to rise as well while public assistance programs are cut and millions of hardworking American people are going to have the rug pulled out from under them and be buried in debt they can't pay back.

Fuck. You.


Whoa, comrade. Tranquila. The austerity and job cuts are going to happen no matter what the debt rating. They are going to happen because of ongoing overproduction. The global purchasing manager's index is barely above 50 [50 means no growth, below 50 means contraction].

Are bad times ahead for the workers? Mos def. But what do you call the last 4 years? Actually, what do you call the last 10 years, which has seen the transfer of wealth up the social ladder, the wars, the reversal of social gains made in the last 30 years?

This is what happens when capitalism weakens-- it has to preserve itself by driving down living standards. Whatever the debt rating of the US is, it is the effect and not the cause.

So fuck the US Treasury, and the credit rating. Cancel the debt as part of a program to expropriate the banks, end the wars, dismantle US military presence overseas, establish universal, free healthcare.

I don't mind anyone taking a bit of pleasure in watching the bondholders, hedge funds, traders choke and look for the nearest window to jump out of. Fuck them too. Here's what I'd tell them and all:

"Too big to fail? Guess not, motherfuckers, now what are you going to do when the Fed can't keep the world economy afloat as it did in 2008-9 through its open-ended unlimited currency swap lines with Japan, the EU, the UK, Brazil, Switzerland, Australia? Give us the phone number of your next of kin to come claim your bodies after you hit the cement. "

Monday is going to be very interesting.

[S.Artesian]

I don't think it's "damn funny" to watch my 401(k) go down the tubes, do you?

Perhaps you're not in a situation where you're affected by this and can sit on the sidelines and laugh.


WTF? Are you aware of the condition of most US pension plans? The gross underfunding in about 40 of the 50 state employee pension plans? The use of bankruptcy by the private sector to renege on pension obligations? The latest on the condition of the Pension Benefit Guarantee Corporation?

Here's the thing. There is no middle ground here. A rich man can get through poor times better than a poor man, and the bourgeoisie are intent on proving that everyday of the week and twice on Sundays.

So we don't argue for "preserving" the AAA rating, so pensions might be gutted in new and different ways. We oppose linking pension benefits to market ratings, market performance,anything other than human needs for a healthy, enjoyable retirement.

[Die Neue Zeit]

Cancel the debt as part of a program to expropriate the banks, end the wars, dismantle US military presence overseas, establish universal, free healthcare.

Just ending the wars and dismantling US military presence overseas sounds a lot better, on your approach to military affairs.

[S.Artesian]

The US government isn't "the bourgeoisie".

Ummh.......yeah comrade, it pretty much is. That's why the government does what it does-- rescue banks, guarantee debts, invade countries-- because it functions as agent of the bourgeoisie.

[praxis1966]

And, yes, there will definitely be more austerity, brought to us all courtesy of the new "Super Congress".

Right, which will come in the form of cuts to already nearly non-existent funding to aid the poorest of the poor. I for one, though, don't think KC's completely off the mark to be concerned about his 401(K) plan. In an era of fiscal expansion, ie the 90s, the right all over this country played on the growing greed of the petite-bourgeois and managed to actually convince people that shifting public sector pension plans away from actual guaranteed pension payments upon retirement and into the volatility of the market was a good idea as a cost saving measure. I guess what I'm saying here is that the programs for the poorest of the the poor are always first in line, next comes public sector employees on the chopping block. The fact that just a week ago defense budget (a Washington sacred cow) cuts were being discussed is indicative of just how deep this thing really is.

Further, I think RadioRaheem's hit the nail on the head with his talk about politicians using this as a vehicle to attack public sector employees. It's already happening out here in Cali. When he's not just shutting down schools outright, Governor Moonbeam can't shut the fuck up about how much of a problem state pension programs are and how much he wants to slash them. I don't see how this won't make this situation go from bad to worse.

At any rate, I don't see any reason to mope about the paralysis of the left. I've seen a million and one people on this site say that if/when a revolution comes it will be in the guise of popular revolt and not because any self-appointed revolutionary convinced the working class of the veracity of our arguments. I tend to agree with that analysis as it speaks to the importance of material conditions being a primary motivating factor. Of all the working class folks I've talked to about economic issues, not one of them has ever disagreed with me when I said that the whole system is fucked and we need to dismantle it completely... regardless of where they sit on the political spectrum... And that was before the other shoe dropped. Which is exactly what's about to happen.

[Rusty Shackleford]

Well speaking of California. This means that if interest rates are effected then the California economy is going to get hurt and that means this november there will be another 5.6% cut to UC and CSU systems and trigger cuts to CCs(which so far have been relatively untouched).

[praxis1966]

Well speaking of California. This means that if interest rates are effected that the California economy is going to get hurt and that means this november there will be another 5.6% cut to UC and CSU systems and trigger cuts to CCs(which so far have been relatively untouched).

Exactly. Anybody want to know a specific way this will affect the working class? I'm working class and I was planning on going back to school this fall at a CC because I can't even get work stocking shelves in a grocery store (true story). Now I'm completely shit out of luck because I have my doubts as to whether I'll actually be able to go to school either... Y'know, between state budget cuts to higher education and federal cuts to financial aid programs. I'm totally screwed.

[Rusty Shackleford]

This is why communists must NOT be shy in classrooms.


But yeah, Sallie Mae is a federal loan thing yeah? In 10 weeks, if the super congress cant make a decision then shit like that will be cut. Even then, states are on the verge of cutting stuff like that too. WHILE THEY ARE RAISING THE SALARIES OF CAMPUS PRESIDENTS!

The president of CSU San Diego Elliot Hirshman(i believe) got a $100,000 increase in his pay($400k now). 4 times the average salary of a professor. and multiples more than other faculty members.

[Martin Blank]

Exactly. Anybody want to know a specific way this will affect the working class? I'm working class and I was planning on going back to school this fall at a CC because I can't even get work stocking shelves in a grocery store (true story). Now I'm completely shit out of luck because I have my doubts as to whether I'll actually be able to go to school either... Y'know, between state budget cuts to higher education and federal cuts to financial aid programs. I'm totally screwed.

And that's exactly the point. The ruling classes no longer need additions to the petty bourgeoisie (or bourgeoisie) beyond generational reproduction. So, there is no longer a point to keeping a large pool of young working-class people with professional skills from which they can draw. You can go join the growing ranks of the unemployed and "surplus population" while competing for the next job opening at McDonald's or Starbucks.

[Rusty Shackleford]

Fannie Mae seeks $5.1bln in aid (http://www.nytimes.com/2011/08/06/business/fannie-mae-seeks-more-help-as-its-loss-grows.html)

Political divide between rival capitalist parties sharpens (http://www.khaleejtimes.com/DisplayArticle09.asp?xfile=data/business/2011/August/business_August135.xml&section=business)

[Die Neue Zeit]

And that's exactly the point. The ruling classes no longer need additions to the petty bourgeoisie (or bourgeoisie) beyond generational reproduction. So, there is no longer a point to keeping a large pool of young working-class people with professional skills from which they can draw. You can go join the growing ranks of the unemployed and "surplus population" while competing for the next job opening at McDonald's or Starbucks.

^^^ So much for the meritocracy illusion.

[Q]

^^^ So much for the meritocracy illusion.

To quote your own words:


The rhetoric of neoliberalism being "one giant conspiracy," particular by big and small business associations (Chambers of Commerce, Federations of Small Businesses, etc.) is a good one. Agitation must be tailored from the most politically aware workers to the least politically aware ones, and must not be above getting past cheap sloganeering and resorting to conspiracy-theory-based agitation for the latter.

So, it's not called the "meritocracy illusion", but the "American dream" ;)

[KC]

WTF? Are you aware of the condition of most US pension plans? The gross underfunding in about 40 of the 50 state employee pension plans? The use of bankruptcy by the private sector to renege on pension obligations? The latest on the condition of the Pension Benefit Guarantee Corporation?

WTF does this have to do with what I said? I was referring to 401(k)'s, not pension plans. I agree obviously with what you said here but I don't see how it's relevant to what I said.

Nowadays people can't rely on pensions, and they can't rely on social security. The only means of possibly saving for retirement for most people that are even able to (because most people can't just stick a million dollars in a fixed income investment that paces inflation) is through their own personal investments. This includes, but is not limited to, defined contribution plans such as 401(k)'s and IRA's. Hence, my statement.



So we don't argue for "preserving" the AAA ratingI never argued for such a thing. There sure are a lot of people putting words in my mouth in this thread.


Ummh.......yeah comrade, it pretty much is. That's why the government does what it does-- rescue banks, guarantee debts, invade countries-- because it functions as agent of the bourgeoisie.This is a completely watered down statement. The state serves the general interests of capital. In the real world this plays out much more complicated than simply "the capitalists are laughing all the way to the bank." That's conspiratorial crap that gets spewed by way too many people on this board.

There is a reason the debt crisis wasn't solved to a sufficient degree to prevent a downgrading, and it is due to the complex nature of the state and the fact that government is a battleground for different sections of the bourgeoisie. If you think that a credit downgrading is beneficial for "the bourgeoisie" (i.e. the bourgeoisie [I]as a whole including the state) then you are sorely mistaken. The failure to resolve the debt crisis is precisely because different sections of the bourgeoisie were too short-sighted and attached to their own interests in order to be able to compromise. This was filtered through politicians whose base (including capitalists) would have strung them high for compromising.

I know you're smarter than this, S.Artesian, so I think you just didn't understand what I was saying.

[RadioRaheem84]

The failure to resolve the debt crisis is precisely because different sections of the bourgeoisie were too short-sighted and attached to their own interests in order to be able to compromise. This was filtered through politicians whose base (including capitalists) would have strung them high for compromising.



Unable or unwilling?

[Rusty Shackleford]

Unable or unwilling?
i think its actually neither.

im contradicting myself now but i think the bourgeoisie is able and willing to do many things in the long term. The problem with them right now is they are split. openly. the 2010 elections basically drove that split home.

Congress is divided between parties. And the new freshmen in the house are radical right-wing ideologues. They basically pulled it apart. The democrats may not have actually shifted right form where they were in 2008 but they have no political will to make a stand for anything they claim to stand for. So, they concede whenever there is pressure.

These two factions of the bourgeoisie are making the capitalist class as a whole unable to make any dramatic move in the short term because of this. (And by short term, i mean a 2 year period in between elections congressional elections)

[KC]

Unable or unwilling?

Yes, the debt crisis was a giant conspiracy acted out by politicians in order to benefit the entire American bourgeoisie.

Give me a fucking braek. :rolleyes:

[Lenina Rosenweg]

WTF does this have to do with what I said? I was referring to 401(k)'s, not pension plans. I agree obviously with what you said here but I don't see how it's relevant to what I said.

Nowadays people can't rely on pensions, and they can't rely on social security. The only means of possibly saving for retirement for most people that are even able to (because most people can't just stick a million dollars in a fixed income investment that paces inflation) is through their own personal investments. This includes, but is not limited to, defined contribution plans such as 401(k)'s and IRA's. Hence, my statement.

I never argued for such a thing. There sure are a lot of people putting words in my mouth in this thread.

This is a completely watered down statement. The state serves the general interests of capital. In the real world this plays out much more complicated than simply "the capitalists are laughing all the way to the bank." That's conspiratorial crap that gets spewed by way too many people on this board.

There is a reason the debt crisis wasn't solved to a sufficient degree to prevent a downgrading, and it is due to the complex nature of the state and the fact that government is a battleground for different sections of the bourgeoisie. If you think that a credit downgrading is beneficial for "the bourgeoisie" (i.e. the bourgeoisie [I]as a whole including the state) then you are sorely mistaken. The failure to resolve the debt crisis is precisely because different sections of the bourgeoisie were too short-sighted and attached to their own interests in order to be able to compromise. This was filtered through politicians whose base (including capitalists) would have strung them high for compromising.

I know you're smarter than this, S.Artesian, so I think you just didn't understand what I was saying.

But the different factions of the bougoise, no matter how their debates are played out though the political process and stage managed "crisis" have much more in common with each other than they do with the working class. The SP credit rating downgrading is in general line with austerity and devaluation being forced upon us. Its not a conspiracy, its capitalism reacting to the crisis of over accumulation. Obviously capitalism hurts itself as part of this process.The same thing happened in World Wars I and II, the great depression, etc. The system has no choice. Its not a failure to compromise within the ruling class which is at the root of the problem, although that is occuring. Its the dynamics of the system itself.

[RadioRaheem84]

Yes, the debt crisis was a giant conspiracy acted out by politicians in order to benefit the entire American bourgeoisie.

Give me a fucking braek. :rolleyes:

Quit fucking making everyone out to look like they're peddling conspiracy theories. There may be different factions of the business class with differing interests but the state usually serves as the managerial arm of all those interests and comes up with a comprimising plan, usually at the expense of the working class.

Maybe it didn't pan out this time and as Rusty layed out the political differences are making the capitalist class unable to as a whole act accordingly in the short term. Doesn't change the fundamental dynamic of the system.

KC you made me think you were a part time contributor to MSNBC for a minute.

[RadioRaheem84]

The same thing happened in World Wars I and II, the great depression, etc. The system has no choice. Its not a failure to compromise within the ruling class which is at the root of the problem, although that is occuring. Its the dynamics of the system itself.

:thumbup1: thank you.

[S.Artesian]

WTF does this have to do with what I said? I was referring to 401(k)'s, not pension plans. I agree obviously with what you said here but I don't see how it's relevant to what I said.

Because defined benefit pension plans have pretty much been reduced to a small minority of plans, and 401ks, defined contribution plans, have replaced them as part of the longer term assault on pension plans. What makes you think that this downgrading is going to have any greater impact on 401ks than the switch to 401ks [and 457bs] had on defined contribution plans. That's the point.

You might as well whimper about the stock market collapse of 2008-2009 as that did the real damage to 401ks, with the average loss in defined contribution plans weighing in at 33%-- and essentially that's what you are doing... moaning about how the decline in capital's ability to reproduce itself profitably enough is going to damage your pension.

Well yeah, but it's not like having a AAA credit rating is going to do the workers in the US or Greece a bit of fucking good. UK has an AAA credit rating and look how well its workers and poor are doing. WTF did you think was going to happen? That you, or anybody, would be able to maintain a "safe haven" for investment in the middle of a global capitalist shitstorm? Sorry to be so blunt, but really, you went off the deep end by telling those who saw bit of payback or Schadenfreude in the change in credit rating to fuck-off.




I never argued for such a thing. There sure are a lot of people putting words in my mouth in this thread.And I never said you did say that. But so what? You think the workers have any stake in the US credit rating whether it's AAA or CCC-? Do you think the Greek workers have any interest in Greece's credit rating? I mean what's your complaint?


This is a completely watered down statement. The state serves the general interests of capital. In the real world this plays out much more complicated than simply "the capitalists are laughing all the way to the bank." That's conspiratorial crap that gets spewed by way too many people on this board.And where have I said anything about a conspiracy? Nowhere. What I said was the state acts in the interests of the bourgeoisie. Often those interests are contradictory... so fucking what? Doesn't make them any less bourgeois does it? I mean there are those who are always arguing how the bourgeoisie's interests are really in the "long term" for "peace," because war disrupts normal trading; there are those arguing that the bourgeoisie's real interests are in increasing taxes on the wealthy as that will produce more revenue for government investment, expanding the economy and will also encourage the bourgeoisie to keep their wealth invested in production where deductions for depreciation, capital investment, even expanding jobs reduces the effective tax rate . But you know what? The bourgeoisie don't think that far ahead. They are driven by short-term interests, a result of the decline in the rate of profit.

Capital is precisely that contradictory, and yeah the government in all its inertia, corruption, confusion, paralysis, ignorance is the most perfect representative of that class and its contradictions. Nothing is watered down about that.


There is a reason the debt crisis wasn't solved to a sufficient degree to prevent a downgrading, and it is due to the complex nature of the state and the fact that government is a battleground for different sections of the bourgeoisie. If you think that a credit downgrading is beneficial for "the bourgeoisie" (i.e. the bourgeoisie [I]as a whole including the state) then you are sorely mistaken. The failure to resolve the debt crisis is precisely because different sections of the bourgeoisie were too short-sighted and attached to their own interests in order to be able to compromise. This was filtered through politicians whose base (including capitalists) would have strung them high for compromising.
It wasn't resolved for the same reason that Bush was elected twice with irregularities that would have made Mayor Daley blush, and the Democrats dropped their challenges-- because of their shared class interest. That's why when push comes to shove their is nothing but "short-sightedness."


I know you're smarter than this, S.Artesian, so I think you just didn't understand what I was saying.I'm smarter than what you are saying, which I understand perfectly.

[Rusty Shackleford]

http://www.nytimes.com/2011/08/07/business/neurofinance-shows-how-investors-can-shun-reason.html?pagewanted=2



No, really. Mr. Alford just hit the key on his computer that initiates the Wall Street equivalent of the nuclear option: Sell everything.
He was acting on orders from two wealthy clients who became so alarmed by the troubled outlook that they simply wanted out. Over the last 10 days or so, they asked him to sell all of their stocks (http://topics.nytimes.com/your-money/investments/stocks-and-bonds/index.html?inline=nyt-classifier) and invest in a mutual fund (http://topics.nytimes.com/your-money/investments/mutual-funds-and-etfs/index.html?inline=nyt-classifier) he oversees that is somewhat insulated against a potential market collapse.
“I have never, ever done it before,” says Mr. Alford, who is the chairman of Alpha Capital Management and has been managing money for 22 years. “This was unprecedented.”
The pros on Wall Street are forever telling us to keep socking our money away in that 401(k) (http://topics.nytimes.com/your-money/retirement/401ks-and-similar-plans/index.html?inline=nyt-classifier) plan and to keep believing, whatever the market’s daily ups or downs. But after a week like the one we just had, the worst since the dark days of 2008, even the smart-money crowd seems to have second thoughts about the old steady-as-she-goes approach.

[La Comédie Noire]

Things are going to get bad folks, stay safe and keep warm. That's all I can really say right now, I'm pretty overwhelmed.

[Rusty Shackleford]

Buy gun, buy pen. done!

[Rusty Shackleford]

http://online.wsj.com/article/SB10001424053111903454504576492501633388840.html?m od=googlenews_wsj

http://si.wsj.net/public/resources/images/OB-PB468_SJ_07L_NS_20110805232804.jpg

[praxis1966]

Buy gun, buy pen. done!

And while you're at it, get out there in your community and agitate your ass off. Stir the fucking pot.

[Rusty Shackleford]

And while you're at it, get out there in your community and agitate your ass off. Stir the fucking pot.
i was quoting sunfarstar. but yeah. For those of you intervening in any struggle that involves the working class. do not hide, AT ALL, your revolutionary politics. if it means flyign a red or black or red&black flag then fine. if it means leafletting the fine. if it means trying to lead chants then fine.



do it.

[DaringMehring]

The big bourgeois financialists have decided... to downgrade the US debt, thereby increasing the spreads and margins on US debt, enabling them to make more money from US debt.

Wow!

Their goal as always --- more profit for them, and forcing more austerity on us.

The only thing this signals, is that they are more and more forced to foul their own nest by increasing their attacks on first-world workers, even in the world's leading imperialist power. But of course basic Marxism had already told us this was the inevitable case.

[Threetune]

i was quoting sunfarstar. but yeah. For those of you intervening in any struggle that involves the working class. do not hide, AT ALL, your revolutionary politics. if it means flyign a red or black or red&black flag then fine. if it means leafletting the fine. if it means trying to lead chants then fine.



do it.

No, with respect, that is bullshit. Only the dictatorship of the working class can help us now and the sooner we all start saying it the better and safer everyone will be.

[Martin Blank]

I'm contradicting myself now but i think the bourgeoisie is able and willing to do many things in the long term. The problem with them right now is they are split. openly. the 2010 elections basically drove that split home.

I tend to agree with you about there being a division over the immediate implementation of the harshest elements of austerity, but that difference over timetables is really one of tactics. The fascistic Nativists on the right, the vestiges of bourgeois (and petty-bourgeois) democracy on the left, and the corporatist consensus at the center -- these are the divisions that exist in the "Minor Congress". Within the "Super Congress", however, it is likely to be corporatist center and Nativist right, with the latter in an obvious minority.


Congress is divided between parties. And the new freshmen in the house are radical right-wing ideologues. They basically pulled it apart. The democrats may not have actually shifted right form where they were in 2008 but they have no political will to make a stand for anything they claim to stand for. So, they concede whenever there is pressure.

The corporatist consensus at the center crosses the party lines, encompassing both Republicans and Democrats. If anything, the entry of the Nativists into Congress has strengthened that center, especially as those elements have pushed for legislation that would more directly benefit them. What was once simply known as the "Gang of Eight" in the Senate is now more like a Gang of 30 or 40. The House is also developing its own corporatist "Gang of X" to counter both the Nativists and the (small-d) democrats.

I would not get too hung up on the idea of Democrats' lack of "political will". That is more a case of theater for the masses than reality. Let's not forget that the debt deal was a bipartisan agreement -- including the creation of the "Super Congress". It was Sen. Harry Reid, considered by many to be the epitome of Democratic Party "cowardice" in Congress, who pushed for this deal in the Senate and got it passed.


These two factions of the bourgeoisie are making the capitalist class as a whole unable to make any dramatic move in the short term because of this. (And by short term, i mean a 2 year period in between elections congressional elections)

The problem with the current debt agreement was that it miscalculated the amount of time that Wall Street and, by extension, world capitalism were willing to give Washington to get its house in order. They figured it would take another three months to prepare "public opinion" for the shock of austerity -- in order to minimize any kind of backlash. Wall Street, which has the same amount of concern about the working class that Metternich did, told Washington that they need to not worry about that (that's what the cops are for, after all) and just do what they're told.

But with Congress out for the summer, something will have to be done quickly. Enter the Super Congress, which can meet when it wants and draft legislation that can be "fast-tracked" at a one- or two-day session between now and Labor Day weekend. If that's not even possible, then there's always an Executive Order.

[Nox]

Haha! Fuck you American economy!

It's great to see the beginning of America's fall from Economic supremacy

[DaringMehring]

Haha! Fuck you American economy!

It's great to see the beginning of America's fall from Economic supremacy

That response is the equivalent of bourgeois cheerleading -- just for non-American bourgeoisie.

"Haha the American economy is going to hell, happy to see the Chinese (or German or whatever) bourgeoisie will now reign supreme!"

It doesn't matter what nationality the leading bourgeoisie are. They are an international oppressor class.

[Madslatter]

No, with respect, that is bullshit. Only the dictatorship of the working class can help us now and the sooner we all start saying it the better and safer everyone will be.
Which won't mean jack shit unless we start agitating AND ORGANIZING! A workers uprising doesn't just arrive from nowhere, we need to get comrades and that is going to require some major agitation. Sitting on the computer *****ing on a website is not agitation, and no Socialist system is going to come about because suddenly the world discovers that revleft has a domain on the internet.

[the last donut of the night]

Haha! Fuck you American economy!

It's great to see the beginning of America's fall from Economic supremacy

Have you ever heard the saying that "when America sneezes, the whole world gets sick"? That's what's been happening and it's unlikely that the international "cold" is going to go away any time soon. But that's not what worries me. It's how international leaders are going to use this shit to further bone over the working class. Examples? The Dilma gov't here in Brazil is pushing several austerity measures, under the guise of scarcity, but at the same time national industries are getting huge tax cuts and inflation hasn't stopped growing in the last couple of months? What do you think they'll say about this lower rating?

If you think this is funny, then either you're just some kind of sadistic apocalyptic dick or just misinformed.

[Kadir Ateş]

Another double-dip is an opportunity for the working class to seriously consider options outside of the existing coordinates of capital. The chances of that happening are probably greater than they are now, given that for most working people, the first recession was never "over" as economists had stated late last summer.

I think there is good reason to worry and at the same time, to also hope for a revolutionary opening. The worry is quite obvious: a bad credit-rating means that interest rates will rise, making it more expensive for people to borrow money. Coupled with $4 trillion in cuts over 10 years, this means that the chances of most social benefits to even survive are nil. The tentative hope is that the working class will yet again be forced with "sober senses" to continue its training from a class in itself to a class for itself, but there are no guarantees. So while I am happy to see this potential opportunity, I am also worried that many will simply resign themselves to an increasingly immiserated condition.

As someone suggested earlier: socialism or barbarism.

[danyboy27]

the working class is getting trampled on again, and nobody is doing anything about it, this is just fucking awful.

be ready for more wage freeze, more layoff, more service cut, more misery and more pain for the whole working class.

No one here on that forum is gonna be safe from the harsh day ahead, europe is going to hell has well and canada is gonna get its fair share of economic shit has well, the situation is serious, mainly beccause well, our wonderful governements are repeating the same bullshit things that dosnt work over and over and over.

Bad times ahead, for all of us.

[Die Neue Zeit]

Have you ever heard the saying that "when America sneezes, the whole world gets sick"? That's what's been happening and it's unlikely that the international "cold" is going to go away any time soon. But that's not what worries me. It's how international leaders are going to use this shit to further bone over the working class. Examples? The Dilma gov't here in Brazil is pushing several austerity measures, under the guise of scarcity, but at the same time national industries are getting huge tax cuts and inflation hasn't stopped growing in the last couple of months? What do you think they'll say about this lower rating?

If you think this is funny, then either you're just some kind of sadistic apocalyptic dick or just misinformed.

OTOH, economies ties between the US and the rest of the world might be a tad overrated. For example, Canada didn't suffer as much during the Bush slumps or even during the recent slump.

[Kadir Ateş]

OTOH, economies ties between the US and the rest of the world might be a tad overrated. For example, Canada didn't suffer as much during the Bush slumps or even during the recent slump.

Internationals own about 45% of the US Treasury, so I imagine there are some very nervous East Asian governments that are not having a particularly good weekend.

[danyboy27]

OTOH, economies ties between the US and the rest of the world might be a tad overrated. For example, Canada didn't suffer as much during the Bush slumps or even during the recent slump.

go tell that to the thousand of canadian worker who have been laid off in the last 2 months.

the canadian and american economy are still verry dependent from eachother.

[Rusty Shackleford]

No, with respect, that is bullshit. Only the dictatorship of the working class can help us now and the sooner we all start saying it the better and safer everyone will be.
No, with respect, that is bullshit. Only with actual organizing openly as a communist will we all be communists. Saying one slogan gets old. Leading chants leafletting and symbolism are 3 easy ways to permeate a demosntration with reovlutionary politics. also, most people probably dont read leaflets. but the ones that do matter.


also, 'safer'?

[Die Neue Zeit]

Another double-dip is an opportunity for the working class to seriously consider options outside of the existing coordinates of capital. The chances of that happening are probably greater than they are now, given that for most working people, the first recession was never "over" as economists had stated late last summer.

I think there is good reason to worry and at the same time, to also hope for a revolutionary opening.

Again, folks, here's the problem with Marx's crisis theory: how it's (ab)used.


The tentative hope is that the working class will yet again be forced with "sober senses" to continue its training from a class in itself to a class for itself, but there are no guarantees. So while I am happy to see this potential opportunity, I am also worried that many will simply resign themselves to an increasingly immiserated condition.

Continuing the sober training through permanent mass institutions with an explicitly political-party atmosphere is very different from depression-based "revolutionary openings" for spontaneists, ill-prepared councils, etc. which are more often redirected towards far-right resentment.

[Rusty Shackleford]

Im going to be watching the asian markets opening in 13-14 hours very closely.

[#FF0000]

Haha! Fuck you American economy!

It's great to see the beginning of America's fall from Economic supremacy

Looks like someone doesn't have bills, rent or loans to pay.

[Threetune]

No, with respect, that is bullshit. Only with actual organizing openly as a communist will we all be communists. Saying one slogan gets old. Leading chants leafletting and symbolism are 3 easy ways to permeate a demosntration with reovlutionary politics. also, most people probably dont read leaflets. but the ones that do matter.


also, 'safer'?

And what does “actual organizing openly as a communist” mean? It means “actual” agitating against the dictatorship of the bankers and the capitalist class who right now are openly planning your financial penury and your social misery all backed up with the force and violence of their state which you can do nothing about unless you organise your own dictatorship against them.

Lets look at your “3 easy ways”. 1) “leading chants”! Chant what? 2) “leafleting” To say what? 3) “symbolism” To symbolise what?

Any right-winger or reformist could say any of what you say, and they do. It is utterly meaningless and devoid of all political substance and absolutely nothing to do with communism.

Your entire paragraph is infused with condescending patronising opportunism ending with the “old slogan” about “most people probably don’t read leaflets.”, as a cover for your own political backwardness and reluctance to raise the only issue that is anywhere capable of addressing the growing ferocity of the capitalist crisis.
Just read the contributions so far on this thread and note the mincing about that goes on in order to avoid raising the question of ‘power’ in the form of workers power over capitalist power.

And the defence for all this shilly-shally is to sneer that ‘just saying dictatorship is just “sloganising”’. It is of course all standard ‘left’ hypocrisy ever ready to give its pessimistic opinions about the alleged inadequacies of distant revolutions, but never rushing to expose the fraudulent “democracy” racket that hides the capitalist dictatorship and start the discussion about working class dictatorship.

As for whether this is the last crisis of capitalism or not, none of the wiseacres on here can possibly know one way or another. The capitalists are not in control of their system so they don’t know themselves what mayhem will happen next – and that is the whole point and reason we need a planned socialist system ruled over by the producing class instead of the parasite class of anarchic criminal bankers.
Of course, everyone on Revleft already knows all this, don’t they?

[danyboy27]

threetune, if you think is necessary to put the working class in the ML line to make stuff happen, you are dead wrong and you dont know squat about human psychology.

people got different opinions and differents views, what they need right now is some serious help to get organised, and we should stick to organizing the worker, create unemployed and underemployed council, political discussion groups where people could talk and get organized.

we should talk about communism, but definitively not in the patronizing way you are.

[RadioRaheem84]

I think we're wasting time criticizing each others posts and getting all worked up over insincere comments.

I want to know more about how workers will be effected by this.

[S.Artesian]

I think we're wasting time criticizing each others posts and getting all worked up over insincere comments.

I want to know more about how workers will be effected by this.

The same way they are affected in Britain with its AAA rating, France with its AAA rating, Greece with its CCC- rating, Japan with its AA+ rating... etc.

The economy is, in its strongest moments, "weak" "fragile"-- the commercial and residential real estate debt, in the US, and across the world, has not been realized-- and just as value has to be realized to engender more capital, debt, even non-performing debt, especially non-performing debt has to be realized, has to achieve its full devaluation in capitalism for accumulation to continue-- welcome to year 1 of the "even bigger hurt," after 30 odd years of the big hurt, and 3 years of the bigger hurt.

EDIT: But it certainly is going to mean a lot to world trade, and the "smooth processing" of international exchanges. We're going to see more "beggar thy neighbor" with currency devaluations; we're going to see more tariffs and trade barriers put up [watch Brazil as it leads the way in this], we're going to see considerably more pressure on the EU; China will go through another round of export and economic contraction, and this one is going to be much more explosive as the rural population is going to put under much stress.

Source of optimism? Workers in France, Spain, Italy, Greece, South Africa.

[Die Neue Zeit]

go tell that to the thousand of canadian worker who have been laid off in the last 2 months.

the canadian and american economy are still very dependent from eachother.

I stated my post above re. the overblown Canadian dependence, in fact, despite the purely political ineptitude of Canadian governments and commercial chatter with respect to diversifying trade partners and having a robust industrial policy to reduce dependence on resource extraction (even more right-wing regimes like South Korea have such).

[Threetune]

threetune, if you think is necessary to put the working class in the ML line to make stuff happen, you are dead wrong and you dont know squat about human psychology.

people got different opinions and differents views, what they need right now is some serious help to get organised, and we should stick to organizing the worker, create unemployed and underemployed council, political discussion groups where people could talk and get organized.

we should talk about communism, but definitively not in the patronizing way you are.

Great but, “organised” for what? “political discussion groups” for what? How should we “talk about communism” without talking about our class rule, our organisations of class power over the power of the capitalists, our dictatorship. Come on, please explain how you do that without doing that. Unless of course you are not planning to do that at all.

Political criticism of clearly reformist blather, about “leading chants” “leafleting” and “symbolism” is entirely legitimate discourse and done right out in the open so that all can see the fraudulent nature of claiming to ‘communism’ when in fact they aren't anything like communists.

[Luís Henrique]

Haha! Fuck you American economy!

It's great to see the beginning of America's fall from Economic supremacy

It is not going to be so fun to have some of the debris falling into our own heads though.

It is not time to rejoyce, it is time to organise and fight back.

Luís Henrique

[Luís Henrique]

That response is the equivalent of bourgeois cheerleading -- just for non-American bourgeoisie.

"Haha the American economy is going to hell, happy to see the Chinese (or German or whatever) bourgeoisie will now reign supreme!"

It is a bit worse than that, for the Chinese (or German, or whatever) bourgeoisie aren't able to fulfill the role (or fill the hole). China is directly tied to US debt and will go bankrupt next if the US defaults. The others are simply unprepared to act as hegemons, and will more likely strive against each others than anything else.

Luís Henrique

[Bronco]

People should bear in mind that the US still has the highest credit rating from several other agencies - most notably Moody's - and besides people lost a lot of faith in the agencies after their gross misjudgements prior to the 2007 credit crunch. It's more of a symbolic move and was hardly unexpected, this is a consequence of the current Capitalist crisis not a cause

[Rusty Shackleford]

And what does “actual organizing openly as a communist” mean? It means “actual” agitating against the dictatorship of the bankers and the capitalist class who right now are openly planning your financial penury and your social misery all backed up with the force and violence of their state which you can do nothing about unless you organise your own dictatorship against them.

Lets look at your “3 easy ways”. 1) “leading chants”! Chant what? 2) “leafleting” To say what? 3) “symbolism” To symbolise what?

Any right-winger or reformist could say any of what you say, and they do. It is utterly meaningless and devoid of all political substance and absolutely nothing to do with communism.

Your entire paragraph is infused with condescending patronising opportunism ending with the “old slogan” about “most people probably don’t read leaflets.”, as a cover for your own political backwardness and reluctance to raise the only issue that is anywhere capable of addressing the growing ferocity of the capitalist crisis.
Just read the contributions so far on this thread and note the mincing about that goes on in order to avoid raising the question of ‘power’ in the form of workers power over capitalist power.

And the defence for all this shilly-shally is to sneer that ‘just saying dictatorship is just “sloganising”’. It is of course all standard ‘left’ hypocrisy ever ready to give its pessimistic opinions about the alleged inadequacies of distant revolutions, but never rushing to expose the fraudulent “democracy” racket that hides the capitalist dictatorship and start the discussion about working class dictatorship.

As for whether this is the last crisis of capitalism or not, none of the wiseacres on here can possibly know one way or another. The capitalists are not in control of their system so they don’t know themselves what mayhem will happen next – and that is the whole point and reason we need a planned socialist system ruled over by the producing class instead of the parasite class of anarchic criminal bankers.
Of course, everyone on Revleft already knows all this, don’t they?
"rabble rabble rabble"


Chant what? what ever makes the demonstration more lively and political. im not a slogan bank you twit.

Leafletting what? im not a full time writer of agitational literature. i guess what you should leaflet is stuff that is actually relevant to the struggle your are in and also attempts to tie it to other struggles for a broader mass movement of working people against capitalism.

Symbolism. Whatever your organization represents. or whatever you represent. if you represent dildos then go do it.(its not going to get you anywhere but whatever.)

my advice was meant to be as general as possible for the Revleft community. not some groundbreaking leninist agitation manifesto. There are some desk-jockey heroes of the proletariat on this website and this is supposed to motivate them to action. This crisis is acute. It is extreme. i dont disagreee with you at all on most things.

i just tend to not like to shout "revolution" and "DotP" into a megaphone because its tiresome and not everyone is that politically developed yet. its time will come, but even this crisis isnt that point yet.


also, im condescending and patronizing? youre the one who starts off with a 1-2 line refutation or whatever of my general advice. in bolded font.:lol:
i will not respond to anything else related to this.

[danyboy27]

Great but, “organised” for what?.

You dont need to have a particular aim to organise the workers, people get together, they got problems, discuss about it and look for various way to fix it, and they take action.



political discussion groups” for what? How should we “talk about communism”
You put it in the discussion, talk about the validity of it, leave the workers discuss about it freely without pumping them Lenin in their ears for a fews hour like folks like you usually do.



Political criticism of clearly reformist blather, about “leading chants” “leafleting” and “symbolism” is entirely legitimate discourse and done right out in the open so that all can see the fraudulent nature of claiming to ‘communism’ when in fact they aren't anything like communists.
You are too attached to the party line, drop it, it didnt worked back then, and it will not work in the future.

The communist party in america didnt got all this popularity in the 20s and 30s that way, they got it by helping the worker organize and merely serve has advisors for the oppressed, helping them to create various organisations here and there. If you look at all the efforts truman and macarty deployed to eliminate the communist party of america influence trought all those year, they must have been doing something right back then.

[tanklv]

Short selling is actually standard practice in bear markets, it's what most day traders and heavy investors do. All it really means is capitalists find ways to make money when the stock market is up and have found ways to make money when it is down.


It does sort of represent a conflict of interest since it is actually against the economic self interest of these politicians to see the economy stronger (in the short term, short selling is not a long term strategy most of the time. When it is, look out). But there are so many other things to worry about in terms of conflicts of interests and such, this is not that important. Really it is just evidence that the capitalist class, which of course includes all or most of our politicians, is compelled to pursue profit in any way possible. Short selling represents a way of making profit in a bear market so they do it. Not very astounding at all. Unless you think in terms of "morals", but then you're so hopelessly lost I can't help you.

"Unless you think in terms of "morals", but then you're so hopelessly lost I can't help you."

WTF? Fuck you very much.

I certainly hope we think in terms of "morals"! Without morality, and doing what's best for the rest of us and the good of society instead of selfishness and greed, we are all lost as a society.

I understand perfectly what "short selling" means - and the fact that it is WRONG to literally bet against your own community - because that's what this is a prime example of.

If you can't understand that, then nobody, certainly not I, can help YOU.

I thought I was on YOUR side, and snide snippy comments and put downs does nothing to bring to the conversation and win supporters. If that's all you and others have to offer, then good luck ON YOUR OWN, because I will NEVER support such idiocy...

[urstaat]

tanklv, I'm rather certain he was referring to the capitalist system and the bourgeois class where amorality and social Darwinism are lauded as the highest of virtues. If your analysis of it involves an assumption of any principled morality on behalf of the major capitalist belligerents, that's what he was implying would be an error.

Also, take a chillaxitive. I know times are stressful and it's hard not to be pessimistic, but the posts I read from you seem to scream hypertension.

[pastradamus]

I seen enough insults, smart-assed comments and general off-topic chat to close this thread.