Zero Hedge on PIMCO’s view of the S&P downgrade, which is that other downgrades of countries are coming soon.
Absolutely spot on point that FrAAAnce is about to become FrAAnce, which also means that Germany’s worst nightmare: that of backstopping the EFSF entirely on its own, is about to become reality.
Ritholtz says the debt ceiling is the least of our problems, listing ten lesson to be learned. Here’s one of them:
Glass Steagall: The Depression-era Glass Steagall legislation was effective in keeping Wall Street crises separate from Main Street. Think back to the 1987 crash — it had little impact on the broader banking industry. But the repeal of Glass Steagall in 1998 allowed FDIC-backed depository banks and Wall Street investment firms to become intertwined. It took less than 10 years for the entanglements to become extremely dangerous. By the time the 2008 credit crisis hit, the troubles on Wall Street were inseparable from Main Street. So banks and investment firms collapsed together.
President Bill Clinton worked tirelessly to repeal Glass-Steagall. He and the Dmmocrats share considerable blame for the current mess. This is hardly all the fault of republicans.
China, the largest creditor of the world’s sole superpower, has every right now to demand the United States to address its structural debt problems and ensure the safety of China’s dollar assets.
[the US] should also stop its old practice of letting its domestic electoral politics take the global economy hostage and rely on the deep pockets of major surplus countries to make up for its perennial deficits.