What’s wrong with this picture?

Posted on News Busters-By Noel Sheppard-On July 18, 2011:

In the midst of staggering illogic surrounding our debt ceiling, ratings agency Moody’s just raised the bar.

On Monday, it announced that the United States could increase its creditworthiness by - wait for it - eliminating the debt ceiling altogether:

“The United States is one of the few countries where Congress sets a ceiling on government debt, which creates “periodic uncertainty” over the government’s ability to meet its obligations, Moody’s [MCO 36.45 0.13 (+0.36%) ] said in a report.

“We would reduce our assessment of event risk if the government changed its framework for managing government debt to lessen or eliminate that uncertainty,” Moody’s analyst Steven Hess wrote in the report.”

Consider the illogic on display.

An entity’s credit rating - whether we’re talking about an individual, a household, or a business - is measured by amongst other things the total amount of debt outstanding, the value of the assets owned, and the cash flow generated each year. 

If debt outstanding rises without a commensurate increase in assets or cash flow, the creditworthiness drops.

Yet the folks at Moody’s are actually saying that in the United States’s case, if it were to remove a curb on debt growth, in their view this would increase creditworthiness.

To further demonstrate the insanity, consider the next few paragraphs:

“Stepping further into the heated political debate about U.S. debt problems, Moody’s suggested the government could look at other ways to limit debt.

It cited Chile, widely praised as Latin America’s most fiscally-sound country, as an example.

“Elsewhere, the level of deficits is constrained by a ‘fiscal rule,’ which means the rise in debt is constrained though not technically limited,” Moody’s said, adding that such rule has been effective in Chile.

It also cited the example of the Maastricht criteria in Europe, which determines that the ratio of government debt to GDP should not exceed 60 percent.”

So, on the one hand, Moody’s wants America to officially “limit debt” citing other countries that are doing a better job of it.

But if the U.S. got rid of the only legislative mechanism it currently has to accomplish this, the ratings agency would see it as a good thing.

That’s akin to fearful residents in a community inhabited by a known child molester hoping his LoJack is removed.”

Source:

http://www.newsbusters.org/blogs/noel-sheppard/2011/07/18/stupidity-moodys-get-rid-debt-ceiling-and-we-wont-downgrade-your-debt

Note: The following articles and/or blog posts and videos relate to this disturbing issue-You Decide:

I. Conservative Solutions, White House Attacks!-Posted on The Heritage Foundation-On July 19, 2011:

http://blog.heritage.org/2011/07/19/morning-bell-conservative-solutions-white-house-attacks/?utm_source=Newsletter&utm_medium=Email&utm_campaign=Morning%2BBell

II. Obama's Proposal Would Dramatically Increase Debt to $2.7T Over Decade!-Posted CNSNews.com- By Terence P. Jeffrey-On July 16, 2011:

http://cnsnews.com/news/article/obama-budget-plan-add-defiicit

III. President Obama Doesn’t Know the First Thing About Economics!-Posted on FoxNews.com-By Iain Murray-On July 16, 2011:

http://www.foxnews.com/opinion/2011/07/16/president-obama-doesnt-know-first-thing-about-economics/

IV. Many states celebrate surpluses as Congress struggles with debt!-Posted on The Washington Times-By Ben Wolfgang, The Washington Times-On July 18, 2011:

http://www.washingtontimes.com/news/2011/jul/17/many-states-celebrate-surpluses-as-congress-strugg/

V. No Recession At White House: Obama’s 454 Staffers Cost Taxpayers $37,121,463!-Posted on The Blaze-By Mike Opelka-On July 18, 2011:

http://www.theblaze.com/stories/no-white-house-recession-obamas-454-staffers-costs-taxpayers-37121463/

VI. Video: Congresswoman Agrees With Obama on Debt Ceiling Debate and Social Security Threat!-Posted on The Blaze-By Naked Emperor News-On July 18, 2011:

http://www.theblaze.com/stories/you-dont-get-it-congresswoman-agrees-with-obama-americans-too-stupid-to-understand-complicated-debt-ceiling-debate-social-security-threat-while-she-cant-seem-to-explain-it/

VII. Dem. Rep. Moran Walks Out During Interview After Supporting Redistribution of Wealth!-Posted on The Blaze-By Jonathon M. Seidl-On July 18, 2011:

http://www.theblaze.com/stories/dem-rep-moran-walks-out-during-interview-after-saying-he-supports-redistribution-of-wealth/

VIII. AP Claims Bush Tax Cuts Caused National Debt to Grow by $1.6 Trillion!-Posted on News Busters-By Tom Blumer-On July 17, 2011:

http://www.newsbusters.org/blogs/tom-blumer/2011/07/17/ap-claims-bush-tax-cuts-caused-national-debt-grow-16-trillion

Note:  My following blog posts contain numerous articles and/or blog posts and videos that relate to this disturbing issue-You Decide:

Is Obama and The American Public on Different Pages, if not Different Books?

http://weroinnm.wordpress.com/2010/01/15/is-obama-and-the-american-public-on-different-pages-if-not-different-books/

Is it important to understand the Marxist assault on the foundations of our system?

http://weroinnm.wordpress.com/2011/01/27/is-it-important-to-understand-the-marxist-assault-on-the-foundations-of-our-system/

Note If you have a problem viewing any of the listed blog posts please copy web site and paste it on your browser. Be aware that some of the articles and/or blog posts or videos listed within the contents of the above blog post(s) may have been removed by this administration because they may have considered them to be too controversial.  Sure seems like any subject matter that may shed some negative light on this administration is being censored-What happened to free speech?-You Decide.

“Food For Thought”

God Bless the U.S.A.!

https://www.youtube.com/watch?v=Q65KZIqay4E&feature=related

Semper Fi!

Jake

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