The Downgrade

The Inconvenient truth congratulates S and P on the downgrade of US credit to AA+. Probably the best thing that ever happened to this great country! How do we know that this is an excellent step? Just listen to the bleating coming out of Washington. Especially from White House "officials" and "sources". Finally somebody has given the establishment a wake up call. Ironically, the call has come from the same agency who, quite frankly, played a major part in creating this crisis in the first place.

We repeat and will continue to repeat. The White House is handling the economic crisis as if it is a facilitating tool in Obama's re-election, cheered on by CNN. Well, sorry to disillusion these folks. The situation is not about politics or elections or the Obama legacy. This is about our children. About future generations and about continued freedom and democracy. Let us not fool ourselves. The alternatives to a weakened US are not pleasant to contemplate. As for the "surprised" looks? S&P warned in April that they expect a cut of at least 4 trillion. The only surprise is that someone actually did what they said they would do. Something quite foreign to The Washington establishment.

If anyone was under the illusion that there exists a painless solution. Well, that illusion has now been ruthlessly expelled by the markets. As for the different political groups either claiming victory or pointing fingers, your political days are numbered folks. Pelosi and the Tea Party...nobody won. America lost. A black and white solution does not exist. S&P basically laid it out. Entitlements need to be cut and tax reform needs to be enacted. A balanced approach. The only missing ingredient is leadership. Voices in the background echoing "that's what Obama said....". That's right, he said it...and we repeat... The only missing ingredient is leadership.

As for the markets, it is doubtful that anybody will argue with the the now obvious fact that gold is the only honest currency. The US treasury continues to state that US treasuries are the gold standard. Actually, gentlemen, gold is the gold standard and if somebody had adhered to it over the last 40 years, we would not be having this crisis today. If the stock market continues downwards today, it will not be because of the downgrade. The downgrade is only a symptom, not the disease.This market had been crashing a while before the downgrade was announced. Probably because the business community took one look at the lack of leadership and the pathetic debt deal, realised that another crisis had been mismanaged and voted with their feet.

From a pure economic point of view, the downgrade should be the start of a more sane attitude to the debt and the deficit. If the president does not understand, that from this point on he has to lead from the front and not point a finger at all and sundry. That the source of the problem is the economy and jobs, not Libya, Afghanistan or his untimely health plan. That his election for a 2nd term is less important than the long term future of the American people, and that US influence has been considerably weakened as a result of mismanagement. Well then, expect more of the same turmoil we have seen thus far. The downgrade presents a clearing of the air. The possibility of a fresh attitude to economic challenges and an opportunity to learn from past mistakes and to begin the preparation of a platform that will allow our children a decent opportunity to build upon for a brighter future. The markets will be our gauge.

Don't expect anything original from an echo - Dunc Muncy

Take out your brain and jump on it - it gets all caked up - Mark Twain