Greece Rated World’s Worst Credit Risk
USA in Worse Shape Financially than Greece
 
 
Mere hours before Standard and Poor’s cut Greece’s credit rating by three levels and branded the debilitated Mediterranean nation with the world’s lowest debt grade for its bonds; Pimco’s Bill Gross told CNBC that the United States’ financial status was much worse than Greece’s. Pimco which manages over $1.2 TRillion in bond funds, according to Gross will NOT be buying U.S. Treasury bonds. The “CCC” credit rating for Greece was not unexpected; the evaluation by Gross of the United States’ fiscal ills is no surprise for regular readers of Rajjpuut’s Folly.  
For most of the taxpaying public, the news from Gross and Pimco, is a savage blow. Pimco, based in Newport Beach, Calif., runs the largest bond fund in the world. Gross confirmed a report Friday that Pimco has little interest in US debt and its low yields that are in place despite an ugly national balance sheet.   "Why wouldn't an investor buy Canada with a better balance sheet or Australia with a better balance sheet with interest rates at 1 or 2 or 3 percent higher?" he said. "It simply doesn't make any sense."
 
As we’ve mentioned many times herein, the combination of roughly $14.5 TRillion in acknowledged national debt; many TRillions more in entitlement debt (social security, Medicare and the federal side of Medicaid) which was never set aside by congress according to legal requirements but rather was spent on ever bigger and bigger government; and the crushing weight of UNfunded future liabilities (the average person paying into these programs over the year is now legally entitled to receive up to 3.1 times their pay-in on average) owed by all those entitlement programs . . . right now stands at roughly $116 TRillion. That is a number roughly 2.16 times the average gross domestic product (GDP) of the entire planet and roughly 7.7 times our American GDP.   And in case you’ve seen other figures . . . it’s simple: they are lies. $116 TRillion is the straight skinny.  In straightforward language, if these people were running public companies and pulled off what they've pulled off on you . . . everyone of them would be in prison for a long, long time. 
Government accounting of the situation has been abetting the lying progressive politicians in these manners for roughly 55 years in the same way that the government now tells us that unemployment is 9.1% in the country (the real figure is roughly 17.8% which includes all those who don’t have jobs that really want one but who don’t fit the government’s narrow definition); in the same way that the government gave us figures about how many jobs that the $787 Billion Obama stimulus “saved or created.” In case you haven’t figured things out yet, Pilgrim, your government is run by the “political class,” that is, by a special interest group whose main purpose in life is to keep the fat, cozy and often senseless bureaucratic jobs created in Washington, D.C. and elsewhere; and for the politicians who passed those laws creating those jobs to get themselves re-elected. They are NOT accountable to you and certainly feel no compunction to tell you the truth EVER. About 20% of the Republicans and 4% of the Democrats in Congress right now are working for you, that’s why those idiots in congress can’t get anything right, because their definition of “right” means “best for them and for the political class” NOT “best for you.”
Bill Gross’ appraisal should stand as an out and out warning to all taxpaying Americans as to the level of damage that the policies of Barack Obama’s administration; and those of Chairman Ben Bernanke’s Federal Reserve Banking System have inflicted upon our economy that so severely undercut the American dollar that unless . . .
1)     House Speaker John Boehner stands by his declaration that “Any increase in the national debt ceiling must be matched ‘dollar-for-dollar’ by a decrease in the budget (our 2011 budget expiring in October is $3.65 TRillion and increases the deficit by $1.59 TRillion)
2)    The house and the senate agree and pass such a program
3)    And President Obama signs it into law rather than vetoing it
 . . . unless such actions take place by roughly August 1, 2011, Rajjpuut predicts that the S&P rating for U.S. Treasury notes will drop very close to Greece’s.  Of course since Obama's handler, multi-billionaire currency-speculator George Soros, would benefit immensely and perhaps double his net worth if the American Dollar collapsed; lost it's 52-year seat as the World's Reserve Currency; and hyper-inflation hit America's shores, which way will the smart money** bet.
 
Moody’s cut its rating on Greece on June 1 to Caa1, leaving only Ecuador as a worse sovereign risk. The S&P rating abasement put Greece well below Ecuador. No other sovereign nation is graded as low as CCC by S&P, according to an S&P spokesman’s e-mail communications.  
“The ratings agencies are now playing catch-up with the market,” said Gianluca Salford, a fixed-income strategist at J.P. Morgan in London. “The market is pricing in a very high probability that there will be a credit event around Greece. The agencies are just catching up to the negativity that’s already priced in by the market, not the other way around.”
Moody’s gave a wake-up call to America when it recently refused to lower the country’s AAA rating but issued a warning that the USA was “trending negative.” The last time such an occurrence hit this country was on December 8, 1941, the day after the Empire of Japan’s sneak attack on Pearl Harbor. It appears that Moody’s and S&P are waiting to see what happens in the upcoming congressional debate over raising the nation’s debt limit. President Obama is asking that the debt ceiling be increased by $2.7 TRillion to $17.0 TRillion. Boehner and congressional Republicans, as we’ve mentioned are saying that any increase in the debt ceiling requires a “dollar-for-dollar” reduction in the budget. IF, a huge IF, if Obama and the progressive Democrats have any sense, than Rajjpuut estimates that the most likely compromise would be a debt-limit increase of $1.7 TRillion (to $16 TRillion) and a 2012 budget of $1.95 TRillion. Those numbers might actually turn the economy around so markedly that they’d have a chance of surviving in power after November, 2012 elections. If, a teensy-tiny if, any other deal comes around, Rajjpuut believes that Moody’s and S&P will NOT compromise and will NOT endanger those who read their evaluations . . . but will severely downgrade the United States’ Credit ratings. So severely, perhaps that paying near loan-shark’s rates on our treasuries will NOT be out of the question. Enjoy your day, taxpayers!
 
Ya’all live long, strong and ornery,
Rajjpuut
 
 
 
** Soros' hedge funds and those run by progressives all over the world are buying up farm land like crazy apparently betting that the collapse of the American economy will lead to a worldwide famine.  Nice people, Rajjpuut bets they just want to put a lot of acreage in foodstuffs to help out in case anything goes wrong?!
 
 
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