You are kidding, right? Like the USDA did with Pigford?
Probably. I have come to think that defensive medicine drives a lot of the cost inflation.
Not sure I would entirely like to live in a country where I could not seek redress for getting the wrong limb amputated, or a clerical error costs me sight in one of my eyes. (latter almost happened to my wife, we didn't sue, but probably could have been successful had we done so)
The fact that lenders are lining up to lend money to the US at very low rates (before the debt ceiling brouhaha at least) means that they are really not concerned with the government's ability to pay. We can discuss whether the deficit and debt is too big or small, but at some point it's just an academical discussion.
What's troubling is that some members of Congress think defaulting is a viable option.
Reagan's "starving the beast" never worked.
Ooops....
I forgot the blue.
just broke through 11,000
Here comes QE3.
It's only down about 10% since the republicans pussied out and gave Obama the deal he wanted.
Now I can buy 11 stocks for the price of 10!
Gold broke the 1,7K mark. Oil is down, and so are Bank stocks.
Banks are the only one actually affected by the degraded ratings of US securities.
How so? They can still borrow at 0% from the government...
I forget the details, but in general, banks have money that people place in their care. They in turn loan this money out. they are required by law to maintain a certain percentage of these assets in AAA rated securities. Sure, banks can still do other practices with all forms of loans and securities, but the AAA aspect of a given percentage is real.
Oh, they already fixed that. Bank regulators have announced they will still count treasuries as AAA rated securities.
LOL...
They are willingly, violating the law?
You expected different?
The only reason I see bank stocks being down right now is because of major lawsuits going around (like AIG just suing BoA a few days ago). There's billions riding on those lawsuits.
Does the law say they have to be rated AAA by all rating bodies?
I don't think it's law that everyone has to abide by S&P's ratings alone.
From what I've heard on the business shows there is alot of concern over the liquidity of some of the big banks like BoA. BoA stock is down to around $6, I don't think that's just because of the lawsuit.
I thought they passed the 'stress tests' with flying colors?
Granted it's only been a couple of days, but I'm glad to see that the downgrade hasn't pushed mortgage rates up. Wife & I have been thinking about a refi and I was afraid that the downgrade was going to blow our opportunity. Not sure how long it will last though. We went ahead and locked in today.
They did.
Investors seem to be discounting that they have made adequate provisions for losses, and they are getting re-sued by some big players, including Fanny and Freddy asking for new settlements in the billions.
http://www.economist.com/blogs/schum...ancial-markets
In the long run, the actual difference in returns between AA+ and AAA is almost statistically non-existant.
A little off point, but the most recent suit was by AIG. That lawsuit is basically for fraud and is a really weak claim.
Will BoFA settle, or fight the whole way?
Settle.
Hmm, I seem to remember that they were also being sued by Fanny/Freddy.
Heh, the Economist nick-named them "Tank of America".
D'oh.
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