Daily Archive: Thursday, July 28, 2011

The danger is from the spending cuts, not the potential downgrade

The headlines are all about the risks of default or a too small deficit reduction package causing a downgrade of US debt. And while markets react to those issues, they all miss the point. The consequences of a downgrade to US govt debt are minor at best. Note that when Japan was ...Read More

Kelton responds to the Progressive Caucus Co-chair

Maddening! The Clinton surpluses were driven by the dot.com bubble and unsustainable private sector deficits. When the bubble burts, stocks crashed, the economy went into recession, and the surplus quickly reversed itself. It was only AFTER the government’s budget moved sharply into deficit that the private sector was able to get out ...Read More

More on Jobless Claims

From Goldman, this talk is making the rounds: More on Jobless Claims Some commentators are attributing the improvement in weekly claims to the fact that this year, the retooling of Auto plants have occurred over one week as opposed as the usual two weeks. This will imply a number in the region ...Read More

DeMint and Erickson to Boehner : HOLD THE LINE

Says it all: Boehner-Reid Debt Plan By Sen. Jim DeMint July 26 — I have troubling news. I’m very careful about criticizing my party’s leaders, but what is happening in Washington right now cannot be ignored. House Speaker John Boehner (R-OH) has abandoned the Cut-Cap-Balance Act and is now pushing a new ...Read More

Insurance Cost Against US Default Hits Record

Somewhat misleading headline. It reflects the odds of being able to deliver a specific treasury bond to the insurer at par. Insurance cost?against US default hits record By Michael Mackenzie and Nicole Bullock May 25 (FT) —Insurance Cost Against US Default Hits Record Published: Wednesday, 27 Jul 2011 | 10:14 PM ETText ...Read More