I can think of a dozen budget items that we cannot afford before i will think of denying essential medical treatment. We all do pay for medicare (about 3% sum of taxes), so some help is paid for.

In addition, most medical expenses during a person's lifetime usually occur during the last year of his/her life. Maybe something could be done about this.

Yves has never before written anything that I so fully disagree with. To claim that the downgrade was warrantless is sadly comical - but then she manages to go downhill from there by berating the agencies as being worthless - and then pitting one worthless agency against the other two to "prove" a political motive. One should ask if this is politcal, who stands to gain from it? Are there political operatives working within S&P engineering a takeover of Washington? But none at Moody's and Fitch? Why would their political motive (whatever it is) be any different? The vampire squid only does business with S&P? LOL!

who was on the short side thursday and friday, and what did they know about the coming downgrade?

inquiring minds want to know.

All of this reminds me of what it is like to be a part of any group. From a group of siblings, to a group of students, to a group of team members, to a group of soldiers, to a group of employees, and finally to a group of citizens:

No matter how well you live up to expectations; you always have to pay for the failures of the lowest common participant in the group.

Moral lesson?...Quit being part of a group, because whomever controls the group will exact punishment on all. Here we go again.

By doing this, I think they are trying to keep some modicum of credibility for future sticksaves. An upgrade would save the market from a lock limit down day.

Yves can blow me.

let me know when you find some politicians to have the honest debate with ....you need more then the handful that presently exists

Corn... is this the feeling, emotion, experience you are trying to describe?

The truth in the dialog in the first 40 secs of this clip is surreal in art not only imitating but foreshadowing of our current societal shift.






Being awake to reality has its dues, and advantages...

I don't think this is being set up for a future stick save. You don't upgrade a sovereign debt rating on whim...it'll take years.

I think S&P is getting a ear full from all of the other nations in the world that have to live by debt ratings - after all, they're trying to issue debt too. All the money goes to the AAA rated debt first.

Was this a black swan or what?

Quote:

Corn... is this the feeling, emotion, experience you are trying to describe?

Pretty much. My brain just gets shutdown by the non-sense.

The feeling is mutual........and it seems to get worse every day.

I think this pretty much says it all:

""We all do pay for medicare (about 3% sum of taxes), so some help is paid for.""

I sense a bit of a logical disconnect on SS, and maybe Medicare.

SS and Medicare payroll deduction is a TAX not a charitable conribution. SS goes into treasury with other taxes and so long as it netted a profit Congress was happy to spend said profit.
Now that it's no longer a revenue stream the Congrasshoppers are howling "My cupboard is bare so gimme yours" and scheming to confiscate the ants' savings (google Ghilarducci 401).

I was told years ago by an old timer who lived through depression that SS was set up initially as a savings program, the money put aside in interest bearing accounts. Very next year Congress recognized the Golden Goose and changed to today's "Pay as you Go" system. I went to federal register and tracked down the 1938 & 1939 congressional bills, found he was right. But i didn't find mention of that on SS website.

So if SS is a tax not a charitable contribution why does it have a cap? Tax code is supposed to be not regressive. Even if you call it a charitable tax, well, the Church expects a flat rate tithe.

Longer term fix is get the insurance industry out of the middle. If Medicare collected my supplement premiums it'd go a long way - that 20% private coverage costs me more than i pay Medicare for their 80%.
Or else make insurance industry carry us old timers through to the bitter end rather than dumping us on rest of you.

And put FSA to work. (I consider health insurance industry part of FSA)

I perhaps am a bit oversensitive, turned 65 last month. Am in year seven of this bypass and will probably need one more before checking out, .
In my healthy years i winced at the payroll deductions but Mom spent so much of her SS on grandkids i couldn't really complain.

I live modestly, draw equally from SS and 401 which should be enough for 20 years. Well it looked so until TPTB decided to inflate their way out of this.

Really - does anybody else think before this is over we'll see minimun wage around $500K a year? Will SS still cap around 70K?

Great post, KD.

A small grammar error (I'm way OCD, sorry, but hey it was in the most important part):

Quote:

We are all collectivity responsible for this - you for demanding that which you were unwilling to pay for, and we in continuing to lie to you for thirty years and enabling the fraud and leverage abuse that made the illusion of prosperity possible...

"we" should be "us" as in "you for ... and us in continuing"

Corn said:

Quote:

This is the beginning of the end of the dollar's reserve currency status. Other countries are not going to tolerate the debasement of their savings.

IMO, not the beginning, but a continuation of a process which has been underway ever since the notion that oil could be priced in something other than US dollars and that bi-lateral foreign exchange in local currencies between non-G7 trading partners was something that could be - and is being - done.

Some of y'all who are on Yves' case have mistakenly attributed some commentary to her and need to go the the NC blog to get the proper formatting.

For example,

Quote:

As Robert Reich tartly observed:

If we pay our bills, we're a good credit risk. If we don't, or aren't likely to, we're a bad credit risk. When, how, and by how much we bring down the long term debt - or, more accurately, the ratio of debt to GDP - is none of S&P's business.

This is Reich speaking not Yves.

MORE IMPORTANTLY the point of that post by Yves - that there was a very interesting chain of events leading up to the downgrade - makes me ask the question "Cui Bono" ?? And the conclusion that the Republican establishment, Standard and Poors, and by implication those who originated securities rated AAA by the ratings agencies when they were anything but (IOW, banks), is not far-fetched, IMO.

Social security cap is already $106,800, not $70k. 6.2% on that is $6,622. That's just the employee's side. The employer "pays" an equal amount. "Self employment tax" is double that - $13,243 on $106,800. (Of course federal & state income taxes are on top of that.) Removing the income cap on SS tax would be the biggest tax increase on the productive in the history of the country. Employees would switch to contractors, get a 1099, start an S Corp, pay themselves $30k salary and the rest as a distribution (thereby avoiding most SS tax and medicare tax as well).

You talk about FSA. Implement a tax increase as big as removing the cap off SS tax and I'll enlist in the FSA myself. I think the Bush tax cuts should ALL expire (including on lower incomes). If you make the tax code even more "progressive", then why work?

Uppity_peasant wrote..

We need a Market Ticker political platform, with our important planks refined down to pithy single sentences.

Uh....we have one already. http://tickerforum.org/akcs-www?forum=Fe....

I take back what I said about Yves blowing me. A hand job will suffice.

I don't get the whole S&P is the Republican's Lap Dog claptrap, when their executives have favored Democrats in political donations: http://thehill.com/blogs/on-the-money/80....

Anyone here going to rush out and buy tomorrow? Not me.

USA is the reserve currency. This is much bigger than the USA. The whole world monetary system was downgraded. We already know where the crack-ups are; Greece, Spain, Italy (relatively new), etc. We also know they are tied to every bank with money.

I have to believe huge deflation is on its way. If the market rises Monday, I will be really frightened.

This is not a nothingburger, or a fat juicy burger, this is aged, beautiful, steak prepared buy the best chef.

I don't listen to the weekly presidential radio teleprompter reading, but media is reporting that the great one failed to mention S&P today. Gee, imagine that an historic US downgrade fails to make the agenda.

I'm surprised the downgrade wasn't larger.
Lets assume our gov't was a production line with a sales guy and a quality manager. Every year, the sales guy determines the units, and the production guy builds fakes when he runs out of material. He then hopes to replace the bad widgets with fresh widgets when more material comes in. As you can see, he is constantly juggling ****ty inventory and hoping the customers never figure this out. This year the line makes 100 units because that's what the sales guy sold (appropriations). The quality guy makes 43 defective units because the machinery is crap (deficit and tax code). The sales guy retorts that next year the sales are going to be 105 units. Quality guy says "sorry dude, next year we will only be able to make 45. You never ordered raw materials. More bad units are going to get shipped." Sales guy is already off to sell more units because that's how he gets paid.
Listening to Washington bicker was sad in the fullest sense.
So I ask,
How is 43% fake production and a plan to make good later AA+ rated?