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I think this is just the start of a slide that ends in a epiphany that the emperor isn't wearing any clothes. But I've said this for a while now...

What is interesting in the news of the downgrade, is China's reaction.

China, the world's largest holder of US debt, had "every right now to demand the United States address its structural debt problems and ensure the safety of China's dollar assets," said a commentary in the official Xinhua news agency.

"International supervision over the issue of US dollars should be introduced and a new, stable and secured global reserve currency may also be an option to avert a catastrophe caused by any single country," the commentary said.

http://www.bbc.co.uk/news/world-us-canada-14428930
As the song goes.. "There may be trouble ahead..."


(S&P normally limit the rating of any company to that of the country it is resident in - I haven't checked, but this decision if applied to the USA could mean downgrades to all the AAA companies in the USA. If they don't, S&P aren't playing fair - but that is another issue).

Cheers,
Shafique

Is China saying that there should be an international committee to monitor how the US spends it money?? Who was watching all the other countries that did or are currently in the toilet because of their poor spending?

My argument with the US is this: stop giving foreign aid!!! stop borrowing money to inject it into other countries!!! The American people are suffering because the American government is more concerned about building up other countries rather than taking care of its own. Not only does American have to deal with the foreigners in the US, but they have to prop up foreigners in other countries.

I saw a news piece where call centers are being created in the US and jobs are slowly coming back (insourcing rather than outsourcing??) into the US rather than going out. At one particualr center, the woman who owns it said that people who are are looking to use her service inquire if the company outsources, and it seems there is a criteria for some companies - they want companies that only do business in the US!!!! At the current pace, call centers in the US will start creating 4,000 jobs a month. That's 4,000 jobs a month that won't be going outside. It's a start and I hope the start of a new trend. IMO, companies that outsource should pay higher taxes. These companies outsource for cheap labor, their goods are knocked off, sent to the US and elsewhere, and then they complain about copyright infringement.

One can only wonder what China would like to see as being the global currency.

I know you must be supporting and defending you home BB, and that is normal...
but I disagree on thie

The American people are suffering

agree on that but not

because the American government is more concerned about building up other countries

and I wonder whey American people are giving their votes to people that only make the America weaker?

unfortunately the US gov. in the past 20 years had made more enemies than friends, and destructed more countries than built!
it is obvious that the curve is going down, if American didn't stand and make a real change in the decision makers board, no one really can expect 2012 onwards..

I'll agree with BB they need to concentrate more on what going on at home but far more than aid the two wars are also not cheap along with maintaing bases in almost every country in the world. The Military Industrail complex also eats up a big chunk aswell.

Its sad they give up stuff like the shuttle program but carry on shuffling money off in aid. But Israel really won't be happy along with Egypt and Pakistan.

I also agree with Mahmoud aswell, you can't just go kick up a shitstorm everywhere from Latin America to the Middle East in the last couple of decades and then expect everyone to be nice to you.

I'm in agreement with Bora. The US and UK should stop propping up other countries with foreign aid. Just look at the two previous posts. They just don't appreciate what is given to them!

If I could have one wish in life, it would be to be in total charge of my country for a year. They'd be no foreign aid, because we can't afford it, and the recipients don't appreciate it, and I'd ship all the hangers on back to where they came from. That would shut the buggers up. Charity begins at home.

lol BM, you are funny today! what are you on!
quick look at history, UK wouldn't really be UK if not countries like the 2 above posts. READ HISTORY.

I still remember stories about British coming to work in bars, and supermarkets in Egypt some years back.
and now! oo most of the money bulks stolen from ME is actually used to build UK economy.

and Qaddafi had 30 billion $ only in USA? you are confused I know, truth hurts

-- Sun Aug 07, 2011 2:30 am --

I just want to add, people and government are in total different ways, ask anyone what do you know about foreign aids! it is governments thing, US is paying to Egypt governments about 1.5 -2 billions $ a year, some military some goods etc. but it ends up in the government pockets,

so people don't know or hear about it, u know the ex- financial minister in Egypt had a dual (Egypt / USA) nationalities! and now Egypt can't get him due to his American nationality!

surprise, he is in London now :s and wanted by Egyptian courts!

Mahmoud04 wrote:lol BM, you are funny today! what are you on!
quick look at history, UK wouldn't really be UK if not countries like the 2 above posts. READ HISTORY.

No, it would be a far, far better and safer place to live without the two Countries above

I still remember stories about British coming to work in bars, and supermarkets in Egypt some years back.
and now! oo most of the money bulks stolen from ME is actually used to build UK economy.

So, the British bar and supermarket employees robbed the ME and built the UK economy into what it is today? Well it’s a theory I suppose a silly one but nevertheless a theory.

and Qaddafi had 30 billion $ only in USA? you are confused I know, truth hurts

I just want to add, people and government are in total different ways, ask anyone what do you know about foreign aids! it is governments thing, US is paying to Egypt governments about 1.5 -2 billions $ a year, some military some goods etc. but it ends up in the government pockets,

so people don't know or hear about it, u know the ex- financial minister in Egypt had a dual (Egypt / USA) nationalities! and now Egypt can't get him due to his American nationality!

surprise, he is in London now :s and wanted by Egyptian courts!

There’s no confusion here M, you’re blaming others again for the corruption and theft endemic to the likes of Gaddafi, Mubarak and their Governments, and the leaders replacing the ousted in the Arab Spring will continue to behave in exactly the same way, it’s the way it is, and you will never accept responsibility for the actions of your Countrymen, you will continue to look to blame others for the financial and political mess your Country is in.

who is blaming who Dillon :s, I didn't blame and not willing to, I am stating facts, if you want to deny them please do! but it is not a secret that governments in US doesn't really keen for better life for people, but just a ruler who maintain their business and knows how to listen, and this has nothing to do with people.

by the way I don't see UK has any weight in the ME, please correct me!

listen we will never come to agree on a political or history point of view, every one has his version, believe it, and not willing to trade it for anything.

The US does nothing other than safe guard its intrests and if that means giving aid than be it so, only problem is it want to maintain its intrests in almost every country in the world and due to that a lot of money goes out in the shape of aid or other incentives other times its sabre rattling, economic or political pressure.

Nothing wrong with looking after your own intrests but trying to influence everyone at the same time can get difficult and even backfire. Right about now it cannot afford to be looking beyond its borders when things aint going so great at home.

Bora Bora wrote:Is China saying that there should be an international committee to monitor how the US spends it money??

Yep - but as a means to control the spending of a country 'addicted to debt'.

I'm sure the irony isn't lost on the Communist Party in China that it is suggesting the USA takes a dose of the medicine it prescribed in the past (directly and via the IMF and World Bank) to other countries who faced similar issues over borrowing too much.

Bora Bora wrote: Who was watching all the other countries that did or are currently in the toilet because of their poor spending?

The IMF and World Bank imposed conditions on countries they bailed out (and generally those countries did worse than those who avoided having to go to these instruments of American hegemony).

Bora Bora wrote:My argument with the US is this: stop giving foreign aid!!! stop borrowing money to inject it into other countries!!!

That'll help a bit. But not much.

China says it should cut spending on benefits and the military (bigger spends). Communist China speaks sense.

Bora Bora wrote:One can only wonder what China would like to see as being the global currency.

Is this a trick question?

Cheers,
Shafique

One third of US foreign aid goes to Israel and Egypt. "Keep the peace" money and a salik "pass" through the Suez. Neither of which are "developing" countries.

I'm not defending the US's involvement (either financially or through a presence) in other countries that they believe is to their benefit, but think about where those countries or regions would be without it?

Shaf, the US was debt free when Clinton left off. There was excess revenue, which Bush used to fund wars, and which he continued to fund and create during his 8 years in the White House. It's not to say that the US wouldn't be in debt today without those wars, but the funding for those wars tipped the scale tremendously. To say that the US is "addicted" to borrowing is a bit of a stretch. It took 12 years to get in the situation it is in with debt. It's poor spending by the parties in the White House. I say a good house cleaning is in order!!! What I would propose is that any country that gives another country foreign aid should oversee the distribution, not put it in the hands of politicans that take their cut off the top. There should be accountability from borrower to lender.

As for stopping the shuttle program, I would like to know exactly what the US learned that America has benefitted from since 1958 when the program was created by NASA? According to the Office of Management and Budget and the Air Force Almanac, when measured in real terms (adjusted for inflation), the figure is $790.0 billion, or an average of $15.818 billion dollars per year over its fifty year history (NASA's 2011 budget is on a continuing resolution of the 2010 budget at $18.724 billion).

@ Mahmoud: you have to understand how the voting process works in the US. At the end of the day it's not the number of individual votes a candidate receives, as we saw when Al Gore had the individual vote, but lost to Bush who won, it's the electoral vote.

Bora Bora wrote:
Shaf, the US was debt free when Clinton left off.

Umm, no it wasn't. There's a difference between budget deficits and surpluses - but I guess simply put, when in deficit the debt is getting bigger, when in surplus the debt is being reduced. I think you're referring to the budget being in surplus, rather than being debt free. There was still government borrowing - but at more 'normal' levels:
http://en.wikipedia.org/wiki/United_States_public_debt

Bora Bora wrote:To say that the US is "addicted" to borrowing is a bit of a stretch. It took 12 years to get in the situation it is in with debt. It's poor spending by the parties in the White House. I say a good house cleaning is in order!!!

I'd side with the Chinese in their view of the scale of the issue.

Note too that this isn't something new. Warren Buffet warned about this a while back - he said the Americans were selling off the family silver in a letter to shareholders a few years back. Also he repeated the warning in 2009.
http://www.nytimes.com/2009/08/19/opini ... =cse&scp=1


Bora - you may also want to look at the size of the US debt - that will put your savings into perspective. (Every little thing helps though - and there certainly is a need to cut down on spending).

Cheers,
Shafique

Insurance on savings: convert cash into gold bricks.

^In 2008 I was seriously considering moving all my dirhams into Gold - the price then was around $700. I didn't in the end.. would have been a good return today, had I done so and kept it. In the end I transferred it out and bought a house instead.

Cheers,
Shafique

On the subject of China wanting the US spending to monitored, would that include the US cutting its development aid to China??

Dated 4 August 2011

http://finance.yahoo.com/news/Senators- ... et=&ccode=

WASHINGTON (AP) -- A bipartisan group of senators is calling for an end to tens of millions of annual U.S. development aid to China, saying there are more needy countries than the world's second-largest economy, which has trillions in foreign reserves.

The eight Democrats and four Republicans made their appeal Thursday to a Senate appropriations committee that must approve foreign aid funding for the fiscal year starting in October.

They urge an end to all development aid for China other than for Tibetans and for promoting human rights.

They say since 2001, the U.S. has provided more than $275 million in direct assistance to China, such as for expanding Internet access and improving public transportation.

The U.S. is scrambling to cut spending to narrow its deficit.

What a joke. The US borrows money from China, then gives it back to China and the US taxpayer pays the interest.