The United States may be on course to lose its ‘AAA’ rating due to the large amount of debt it has accumulated, according to Martin Hennecke, senior manager of private clients at Tyche.
“The U.S. might really have to look at a default on the bankruptcy reorganization of the present financial system” and the bankruptcy of the government is not out of the realm of possibility, Hennecke said.
“In the United States there is already a funding crisis, and they will have to sell a lot more bonds next year to fund the bailout packages that have already been signed off,” Hennecke told CNBC.
In order to solve or stem the economic slowdown, Hennecke suggested the US would have to radically reduce spending across all sectors and recall all its troops from around the world.
As for a stimulus package, there is not much of an industry left to stimulate back into life, Hennecke said.
Moe Lane
Steve Maley
Dan McLaughlin
Neil Stevens
Daniel Horowitz
This guy is a doom prophet...
mikefisk (Diary) Wednesday, November 12th at 9:30AM EST (link)…probably a perennial bear, and now is getting an audience to air his crackpot theories because things are in the tank and he looks pretty credible at the moment.
The thing is, the US isn’t going to lose its AAA rating unless some major debt issues occur well above and beyond what currently exist, or we enter a new Great Depression. Yes, the debt level is phenomenal, but, relative to GDP, it’s still nothing compared to, say, Italy. People are still beating down our doors to lend us money from overseas.
My main clue this guy is a crackpot? His comment about having to withdraw all of our foreign troops in order to shore up finances. We spend about 3.5% of GDP on the military, about 15% of all spending, and not all of that is for overseas troops. If he were a credible bear, he’d be talking about taking large chunks out of entitlement programs first…
“Once within the maw of Leviathan, degree of digestion is irrelevant.” – Michael Fisk
9.25, -4.77
This is why I posted this here...
izoneguy (Diary) Wednesday, November 12th at 9:35AM EST (link)…I know the guy is a crackpot. This was on CNBC.
“Hennecke suggested the US would have to radically reduce spending across all sectors and recall all its troops from around the world.”
This is the line that got me.
Sounds like an Obama idea.
Get ready when Obama starts using this line for the rational
to close bases and not only bring the troops home but
release them from military service as well.
The point cannot be made often enough: Modern liberalism, as embodied in the Obama presidency, is the defender of the status quo. And the status quo is a road to economic ruin. Political forces cannot redistribute the wealth that the economic system does not produce.
To the crackpot's credit...
mikefisk (Diary) Wednesday, November 12th at 10:59AM EST (link)…he did say to cut spending everywhere.
I doubt Obama has the will, or the political support, to even attempt that.
“Once within the maw of Leviathan, degree of digestion is irrelevant.” – Michael Fisk
9.25, -4.77