Late Night: Moody’s Reviewing Downgrade of U.S. Credit Rating; Obama Slaps Down Eric Cantor.
Posted: July 13, 2011 Filed under: Republican politics, Surreality, U.S. Economy, U.S. Politics | Tags: arm-twisting, Barack Obama, bipartisanship, Eric Cantor, Federal debt ceiling, Moody's, The Chicago Way, U.S. Credit rating 11 Comments
Eric Cantor
The U.S., rated Aaa since 1917, was put on review for the first time since 1995 on concern the debt threshold will not be raised in time to prevent a missed payment of interest or principal on outstanding bonds and notes even though the risk remains low, Moody’s said in a statement yesterday. The rating would likely be reduced to the Aa range and there is no assurance that Moody’s would return its top rating even if a default is quickly cured.
President Barack Obama is considering summoning congressional leaders to Camp David this weekend to work on a plan to raise the debt ceiling after yesterday’s negotiations on a deficit-cutting plan of at least $2 trillion stalled, according to two people familiar with the matter. A failure to raise the debt limit that causes a default may lead to slower economic growth and another financial crisis.
“It’s obviously very serious in so many different ways,” said James Caron, head of U.S. interest-rate strategy at Morgan Stanley in New York, one of 20 primary dealers that trade bonds with the Federal Reserve. “Most people still believe there will be some type of an agreement struck to avoid all this stuff, and that’s what the market’s banking on.”
Meanwhile, according to the NYT, Fed Chairman Ben Bernanke
warned on Wednesday of a “huge financial calamity” if President Obama and the Republicans cannot agree on a budget deal that allows the federal debt ceiling to be increased. Moody’s, the ratings agency, threatened a credit downgrade, citing a “rising possibility” that no deal would be reached before the government’s borrowing authority hits its limit on Aug. 2.
The one piece of good news is that President Obama may be finally waking up to the reality that Republicans are totally insane and there is no point in negotiating with them.
the latest bipartisan negotiating session on Wednesday evening ended in heightened tension, if not outright discord. Republicans said Mr. Obama had abruptly walked out in an agitated state; Democrats described the president as having summed up with an impassioned case for action before bringing the meeting to a close and leaving.
Politico has a better description of what happened–basically, Obama told lit into Eric Cantor and brought him up short for once.
When Cantor said the two sides were too far apart to get a deal that could pass the House by the Treasury Department’s Aug. 2 deadline — and that he would consider moving a short-term debt-limit increase alongside smaller spending cuts — Obama began to lecture him.
“Eric, don’t call my bluff,” the president said, warning Cantor that he would take his case “to the American people.” He told Cantor that no other president — not Ronald Reagan, the president said — would sit through such negotiations.
That’s Cantor’s version. Democratic sources said that
“Cantor’s account of tonight’s meeting is completely overblown. For someone who knows how to walk out of a meeting, you’d think he’d know it when he saw it,” a Democratic aide said. “Cantor rudely interrupted the president three times to advocate for short-term debt ceiling increases while the president was wrapping the meeting. This is just more juvenile behavior from him and Boehner needs to rein him in, and let the grown-ups get to work.”
Now here’s the kicker:
“Obama lit him up. Cantor sat in stunned silence,” said an official in the meeting. “It was incredible. If the public saw Obama he would win in a landslide.”
Maybe Obama really does have some balls guts? Maybe it just took a snot-nosed squirrely creep like Cantor to get a rise out of him. It does seem that for once Obama has managed to force the Republicans into a corner by offering cuts in Medicare and Social Security and then threatening not to write checks in August.
Stay tuned. There will be more discussions at the White House tomorrow afternoon. Maybe it’s time for Obama to do the the Chicago way. The heck with bipartisanship–time for some major arm-twisting. Just raise the frickin’ debt ceiling and be done with it.
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The HIll:
LOL! Finally some down and dirty, stab in the back politics.
I hope he has them in a corner now………you got a slpit, the non tea party republicans and the tea party republicans, and the non tea party saying “get er done” (McCain & Kyl), but stay tuned, cause things are bound to change from minute to minute.
I have another view of the Obama/Cantor dust up. Cantor acted disrespectfully to Obama who took umbrage at that. We’ve seen him get an attitude in the past when he felt attacked personally. I’m not sure that it had anything to do with representing the American people.
I’m going to wait to see what Obama gives away on Social Security and Medicare before I give him any props for his set down of Cantor.
Maybe, I’ll be surprised.
It doesn’t really matter why he did it if it ends up with the debt ceiling just getting raised without all the stupid cuts. That’s the way it looks right now after McConnell blinked. Plus Boehner has lost control of his caucus. I think Obama really did want all those cuts, but now he’s not going to get them, and I’m just hoping he’s forced into doing the right thing. I think it’s a good sign if he’s finally mad. The “bipartisanship” thing is way past old.
Graham: GOP has no one ‘to blame but ourselves’
http://www.politico.com/blogs/glennthrush/0711/Graham_GOP_has_no_one_to_blame_but_ourselves_.html
ROFLOL!
This link is hilarious Dak, thank you for posting it. Geez, too damn funny.
I hope everyone noticed that President Obama told everyone, that his idol is Reagan, not JFK, or MLK.
That seems to be getting past a lot of people. But there it is, plain as day.
Yup.
This is really bad :
Moody’s Will Cut 7,000 Top-Rated Munis If U.S. Downgraded, Reviewing More
http://www.bloomberg.com/news/2011-07-13/california-may-sell-notes-before-federal-debt-limit-deadline-lockyer-says.html
As I’ve written before, the Treasury Bonds are considered to be the world’s base risk free rate which means if they reprice Treasuries, everything else gets repriced upward too. Some of these states and cities are not doing well now. It could put them over the edge, I have no idea why some of the airheads in the Republican party don’t realize they’re threatening every business, state, and city in the country with increased interest rates. Consumers too. The Fed has said it will step in to to try to stop it, but there’s not much it’s going to be able to do on most of these.