The US government has had a triple A credit rating since 1917, but it is unclear how long this will continue to be the case.Hat tip to Ed Morrissey via Ace of Spades, who has a very good round-up of the harbingers of a fiscal/monetary apocalypse. I've been warning about this for months, as in February:
Go talk to some people who know a bit about the bond market, and see how they think the global investor class -- U.S. debt is a commodity traded globally -- will react to the prospect of still more deficit spending piled on top of all the deficit spending for the $152 billion "stimulus" in May, $350 billion for TARP I, and now $789 billion for more "stimulus." Another $350 billion for TARP II? Oh, they're going to love that.It Won't Work, The Fundamentals Still Suck, and Economics Is Not a Popularity Contest.
If the world's investor class believes that your Keynesian pump-priming will work, they'll be happy to buy up all those Treasury notes, just like they'll be happy to buy stock in U.S.-based corporations. Do you think those people are stupid, sir?
Back in 2007, I was talking to economists who were worried about the impact that the housing bubble collapse (which began in 2006) would have on the economy. And the same economists are now muttering dark forebodings about the impact of this multi-trillion-dollar deficit spending spree.
Well, when the Dow Jones bounced up above 8,000 -- after falling below 6,700 in March -- some people were saying the worst was over. We had hit the bottom, and now the recovery would begin. Two words: "Sucker's rally." The Dow hit 8,575 on Friday and, though I'm no financial guru. my hunch is we're now beginning another slide downward. Pessimists tell me they don't think we'll hit bottom above 4,000.
Why? Well, how about the idiotic noises about health care emerging from Washington? The liberal suggestion that we will actually save money by implementing universal health care is, as Megan McArdle says, "gibberish in a prom dress."
Unemployment is surging. The Obama administration is meddling with mortage rates and Treasury wants to take over the derivatives market. Liberals are pushing for a "global warming tax." Government is ripping off investors. The rule of law is trampled underfoot. All the signals from government now point toward more deficits, more taxes, more inflation, more regulatory restrictions to impede the private sector.
Hello, Weimar America.
(Cross-posted at Hot Air Green Room.) UPDATE: Linked at Kuru Lounge and Creative Minority Report. Meanwhile, Mary Katharine Ham observes:
With utterly unprecedented spending and build-ups in deficits with utterly no attempt to control either, despite promises to do so from Obama on the trail, the American people may be looking for anti-establishment comfort in 2010. By then, it won't be about being Republican, but about being responsible. Democrats have been so deliberately, demonstrably irresponsible in just four months, that making the argument for Republicans (fiscally conservative ones) becomes easier and easier by the day."Fiscally responsible Republicans" = Not Charlie Crist. More like Jim DeMint and Tom Coburn.
Tigerhawk wonders if Team Obama believes they'll be able to blame Bush forever. But how will they blame Bush for Obama's job-killing tax plans? (Graphic by Heritage Foundation.) More commentary at Memeorandum.
The New York Times is trying to cover up Democrats' blame for the mortgage crisis.
UPDATE II: Obama demagogues credit cards:
People are "getting ripped off by anytime, any reason rate hikes... all kinds of harsh penalties and fees that you never knew about,'' Obama said. "Enough is enough, it's time for strong protections for our consumers.''Good God. If you don't like the rate, don't use the card. How simple is that? Caveat emptor. But by limiting rates, you would necessarily limit the availability of credit, since banks have to calculate the likelihood of default into their rates.
And his audience cheered.
Ergo, limiting rates means less credit for the poor, which is certainly going to hinder economic recovery. And yet Obama's audience cheered his nonsense!