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The week ahead: December 16th 2011
Under pressure
Dec 16th 2011, 10:28 by The Economist online
ARAB leaders meet to discuss Syria, France braces for a credit rating downgrade, airlines await a decision on carbon emissions and American politicians race to prevent a budgetary squeeze
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The Eurozone problem is getting out of control! If France is downgraded, I will have lost my faith in these credit rating games. I think it's absurd that people are held to a much higher standard when it comes to our credit ratings, but a country can go into debt in the trillions and still maintain a relatively high credit rating! A joke indeed! It first happened with the U.S. and now potentially France? What's next, Great Britain? France and America, I recommend you work to repair your credit before you take the whole world down with you. The butterfly effect is still to be seen, but I truly believe the glory days of the Western world have entered their gloaming. Perhaps it's time to practice my Mandarin?
The West is paying the price for its decades of insane profligacies on borrowed money, like there is no tomorrow. The Day of Reckoning has finally caught up with the West.
The problems facing the Eurozone are small when compared to the issues that will be facing investors as U.S. debt continues to rise. Here is an article showing how the United States, holder of over $15 trillion in debt, is unlikely to ever achieve fiscal balance:
http://viableopposition.blogspot.com/2011/11/united-states-debt-interest...
Should interest rates rise to the average level of the past decade, interest on the debt would reach $700 billion, consuming 70 percent of individual income tax revenue and all but negate the impact of Budget Control Act spending cuts.