BREAKING: Moody’s Threatens to Lower US Credit Rating

The main headline in the hardcopy of today’s Financial Times? “Moody’s in threat to strip US of top rating.”

Rating agency Moody’s has threatened to downgrade the US’ prized triple A credit rating if Congress fails to reach a deficit reduction deal, raising the stakes in the fiscal debate that lies at the heart of the November election.

Moody’s said yesterday it was considering joining its rival Standard & Poor’s — which stripped the US of its top rating last year — if a deal was not reached by the end of 2013.

Moody’s statement can be found here.

Reuters points out the problem is the current stalemate between the President and Congress, which could be helped by a Mitt victory:

[Moody’s] warning comes two months before national elections that may fail to loosen the current gridlock in budget policy.

Recent polls suggest that if the election were held tomorrow, President Barack Obama would win a second term while Republicans would strengthen their hold on Congress.

Moody’s, which gives the United States the top Aaa credit rating but with a negative outlook, said Congress needs to put the debt level on a downward trajectory to maintain that rating.

Of course if Mitt wins there’s reason to believe the picture will improve. Reuters continues:

Click here to continue reading

Obama’s Scheme Team: “Kill Romney” - Governor Romney Responds: “Desperate, Despicable”


As America continues to suffer from President Downgrade’s Obama’s inexperience and blunders, talking heads predict that the next presidential election is bound to be one of the nastiest, dirtiest campaigns in a long time.

Not surprising, Real Clear Politics revealed last week that Democrats believe Mitt Romney is the greatest threat to their man, Obama:

In gearing up for President Obama’s re-election battle next year, party operatives have directed the bulk of their energy toward beating up on the former Massachusetts governor. With a number of strong Republicans opting not to run and some in the race failing to get traction, Romney has become a singular target for the party in power.

Today, we learn just how afraid Obama and his Scheme Team are:

Barack Obama’s 2012 plan: ‘Kill Romney’

Barack Obama’s aides and advisers are preparing to center the president’s re-election campaign on a ferocious personal assault on Mitt Romney’s character and business background, a strategy grounded in the early stage expectation that the former Massachusetts governor is the likely GOP nominee.
[…]
“Unless things change and Obama can run on accomplishments, he will have to kill Romney,” said a prominent Democratic strategist aligned with the White House.

The onslaught would have two aspects. The first is personal: Obama’s re-elect will portray the public Romney as inauthentic, unprincipled and, in a word used repeatedly by Obama’s advisers in about a dozen interviews, “weird” …

The second aspect of the campaign to define Romney is his record as CEO of Bain Capital, a venture capital firm which was responsible for both creating and eliminating jobs. Obama officials intend to frame Romney as the very picture of greed in the great recession – a sort of political Gordon Gekko.

(emphasis added) Additional details may be found here.

Romney issued a swift response:

August 9, 2021

BOSTON, MA – Romney for President campaign manager Matt Rhoades released the following statement in response to Politico’s report on President Obama’s re-election strategy:

It is disgraceful that President Obama’s campaign has launched his re-election with the stated goal to ‘kill’ his opponent with an onslaught of negative and personal attacks. President Obama will say and do desperate things to hold onto power because he knows he has failed. Neither despicable threats, nor President Obama’s billion dollar negative campaign, will put Americans back to work, save their homes, or restore their hopes. On November 6, 2012, this will change.”

(emphasis added)

Obama won’t be able to run successfully on his record. Even the lefty-left of his party are in full rebellion now:

On Sunday, Drew Westen, a professor of psychology at Emory, articulated the fury of liberal Democrats in a New York Times Sunday Review essay.

How can one explain this lack of leadership? Westen offered several harsh theories. Perhaps Obama is, as conservatives have alleged, too inexperienced and hence, incompetent. Obama, he wrote, “had accomplished very little before he ran for president, having never run a business or a state.” He had a “singularly unremarkable career as a law professor, publishing nothing in 12 years at the University of Chicago other than an autobiography.” Finally, before joining the Senate, he had voted “present” rather than “yea” or “nay” 130 times, “sometimes dodging difficult issues.”

(emphasis added)

Obama and his Scheme Team will resort to that which they are very familiar and comfortable with - the ol’ Alinsky Rules for Radicals. [Known as the ‘father of modern American radicalism,’ Saul D. Alinsky (1909-1972) developed strategies and tactics that take the enormous, unfocused emotional energy of grassroots groups and transform it into effective anti-government and anti-corporate activism. … Some of these rules are ruthless, but they work.”]

A few Alinsky tactics to look for…

Whenever possible, go outside the expertise of the enemy. Look for ways to increase insecurity, anxiety and uncertainty. (This happens all the time. Watch how many organizations under attack are blind-sided by seemingly irrelevant arguments that they are then forced to address.)

Ridicule is man’s most potent weapon. It is almost impossible to counteract ridicule. Also it infuriates the opposition, which then reacts to your advantage.”

If you push a negative hard and deep enough, it will break through into its counterside… every positive has its negative.” [Obamacare is Romneycare?]

Pick the target, freeze it, personalize it, and polarize it. In conflict tactics there are certain rules that [should be regarded] as universalities. One is that the opposition must be singled out as the target and ‘frozen.’

I can see how Mitt Romney’s private-sector experience, record of accomplishments, leadership, wisdom, work ethic, and straight-forward campaigning makes the Obama Scheme Team’s knees knock.

We’ve got a desperado president on our hands. America can’t take four more years of Oval Office conniving.


► Jayde Wyatt

A new video on this subject from the Romney campaign below the fold Click here to continue reading

Obama’s Horrible, No Good Day: Romney Speaks on S&P Downgrade

We wondered how the first day of trading on the stock market would go after the S&P downgrade last Friday…

Now, we know.

It was a bloody day.

98% of of today’s volume was sold in declining stocks. The Dow today closed at 634 points in the negative - the seventh worst point drop in United States history.

While opinions on the reliability of S&P and other credit rating agencies go back and forth, the reality that our federal government has spent the U.S. into oblivion is undeniable. The rate at which our debt is increasing measured against our GDP, and the current political atmosphere, were factors in our historical, first-ever credit downgrade.

Obama was mum on S&P all weekend; he emerged today to deliver a flat, teleprompter speech. The Dow was down 400 points before Obama spoke. Ten minutes after he finished, the market plummeted another 200 points.

Mitt Romney spoke on the S&P downgrade while delivering a speech in Concord, NH this morning:


“This nation is going to have to get very serious about the excesses of government.” ~ Mitt Romney (August 8, 2021)

A look back

● April 18, 2022 - Standard & Poor’s downgrades outlook for US economy from stable to negative for the first time in its existence.

● April 18, 2022 - Romney tells Hannity (FOX News): “The Obama presidency was downgraded today. And people recognize that this president is playing chicken with the U.S. economy… But if the interest costs are going up why it could be devastating to the U.S. economy and could make job growth even more difficult.”

● April 18, 2022 - Obama’s chief economic adviser, Austan Goolsbee, says, “I don’t make too much about it.”

Romney says Obama is playing ‘chicken’ with the U.S. economy.

(Click on image to enlarge.)

● April 19, 2022 - Timothy Geithner says a downgrade won’t happen. (I have a hunch Tim will be asked about this…)

● April 20, 2022 - Romney on San Diego station KCBQ: Obama should meet the raters. (Massachusetts received credit rating upgrades from both Standard & Poor’s and Fitch Ratings while Romney was governor.)

“Standard and Poor’s, one of the rating agencies, just downgraded their view of the future for America. If you will, they downgraded the Obama presidency. In my own view, this is not something to be laughed off as the president’s people seem to be doing. The president really ought to personally sit down and meet with S&P. I did that when I was governor; I met with the ratings agencies and talked about our future and tried to instill confidence in our future because, look, how they rate our debt and how they rate our future as a nation will affect the interest costs that we end up paying and will affect homeowners and borrowers all over the country.”

● April 25, 2022 - The Gov’s op-ed WARNING about S&P downgrade


The main job of any executive — whether a CEO, a governor or a President — should be to avert these dangers, or work to repair them. When I took office in Massachusetts, we faced job losses and a fiscal crisis that had the potential to shake the faith of the credit raters in our bonds. We went to work to convince S&P and the other rating agencies that we were committed to reducing spending to balance our budget. I met personally with these officials in my of­fice in Boston, and I traveled to New York City to meet them in their offices. S&P responded in 2005 with a credit rating upgrade that acknowledged the state’s sound fiscal management and the improving strength of its revitalized economy.

Barack Obama is facing a financial emergency on a grander scale. Yet his approach has been to engage in one of the biggest spending binges in American history [since World War II]. With its failed stimulus package, its grandiose new social programs, its fervor for more taxes and government regulations, and its hostility toward business, the administration has made the debt problem worse, hindered economic recovery and needlessly cost American workers countless jobs.

(emphasis added) Read more here.

● June 29 -30, July 14, 2022 - Romney speaks on debt-ceiling debate

● July 14, 2022 - Romney also speaks on debt ceiling at Town Hall meeting in Derry, NH

● August 1, 2021 – Additional statement on debt ceiling from Romney

“As president, my plan would have produced a budget that was cut, capped and balanced – not one that opens the door to higher taxes and puts defense cuts on the table. President Obama’s leadership failure has pushed the economy to the brink at the eleventh hour and 59th minute. While I appreciate the extraordinarily difficult situation President Obama’s lack of leadership has placed Republican Members of Congress in, I personally cannot support this deal.” ~ Mitt Romney

● August 6, 2021 - Romney’s Response to S&P Downgrade: USA Credit Rating Latest Obama Casualty

Obama will go down in history as the first president to lose America’s Triple A credit rating. When he took office, the U.S. was spending 40% of GDP on federal debt. Last year we were spending 62%. By the end of this year, we’ll have spent 72%. Even if we get all the cuts outlined in the debt-ceiling agreement, we’ll be spending 76% of GDP in 10 years.

This was a horrible day for America.

This was a horrible, no good, rotten day for Obama.

Mitt Romney 2012.


P.S. Obama isn’t worried, though. He has planned an October 2012 surprise…

UPDATE

From MittRomney.com

FROM “MALAISE” TO MELTDOWN
August 8, 2021

[..]
Under Governor Romney, Massachusetts received credit rating upgrades from both Standard & Poor’s and Fitch Ratings.

In March 2005, Standard & Poor’s upgraded Massachusetts’ general obligation bond rating to “AA,” noting the state was “again producing jobs and reducing already historically low unemployment.” The Boston Globe reported:

“In many ways, Massachusetts is emerging from the downturn in good shape. … In recognition of the improvement, Standard & Poor’s in March upgraded the state’s bond rating to AA, the highest ranking the state has enjoyed since the late 1980s. … ‘An economy that is deep and diverse is again producing jobs and reducing already historically low unemployment,’ Standard & Poor’s wrote in its upgrade of the state’s bond rating.”

In July 2005, Fitch Ratings upgraded Massachusetts’ general obligation bond rating to “AA,” citing the state’s “prudent fiscal management.”

“Fitch Ratings upgrades the rating of $14.4 billion Commonwealth of Massachusetts full faith and credit general obligation (GO) bonds to ‘AA’ from ‘AA-‘. The upgrade reflects the commonwealth’s economic recovery, enabling surplus operations and the rebuilding of reserves to strong levels. Prudent financial management through the recent downturn has positioned Massachusetts well.”

More here.


► Jayde Wyatt

Mitt Romney: “Obama Failing to Lead on U.S. Economy”, 2nd Quarter GDP Stuck in the Muck

Economists held their breath awaiting the release of the Commerce Dept 2nd quarter GDP report. The grim news, 1.3% growth, reveals the U.S. economy is stuck in the muck.


Today’s Commerce Dept GDP report reveals the U.S. economy is stuck in the muck.

The 1.3% second quarter growth is almost the weakest recovery pace since the big recession officially ended two summers ago. We’re also a year out from the release of the Obama/Biden duet Summer of Recovery.

Economy grinds to halt as consumers pull back

NEW YORK (CNNMoney) — Consumers all but shut their wallets in the second quarter, causing the U.S. economy to grow at a tepid pace.

To make matters worse, growth in the first quarter was much slower than initially thought, according to new government figures released Friday.

It’s quite worrisome as the economy remains at stall speed in the second quarter,” said Sal Guatieri, senior economist with BMO Capital Markets. “If that continues, then it would raise the risks of a double dip.”

Gross domestic product, the broadest measure of the nation’s economic health, rose at an annual rate of 1.3% in the second quarter, the Commerce Department said.

While that’s an increase from the revised 0.4% growth rate in the first three months of the year, it is hardly good news. The government originally reported that the economy grew at a 1.9% annualized rate in the first quarter.

(my emphasis)

● Note the revised growth for the first quarter of 2011. Will the already cheerless second quarter numbers also be revised?

Mitt Romney responds:

Tweet…

Today’s dismal GDP report once again shows @BarackObama is failing to lead on the economy mi.tt/pqn1Tw #ObamaIsntWorking

PRESIDENT OBAMA IS LEADING IN THE WRONG DIRECTION

In Recent Days, President Obama And His Team Have Insisted We Are Headed In The Right Direction On The Economy:

President Obama, On The Economy: “I Think The Trajectory Is A Good One.”

OBAMA: “What people want to know is that we’re moving in the right direction, even if they’re frustrated with how fast we’re moving, we need to speed it up, but I think the trajectory is a good one.”

Treasury Secretary Geithner: America Is “Undeniably” In A Stronger Economic Position Today Than “Three Or Four Months” Ago. FOX’s CHRIS WALLACE: “You think you’re in a stronger position on the economy today than you were…” GEITHNER: “Oh, undeniably.” WALLACE: “…three or four months ago when you were growing hundreds of thousands of jobs a month?” GEITHNER: “Absolutely … The economy is growing. American businesses are investing again. Exports are getting stronger. That is all going well.”

Today’s Dismal GDP Report Confirms That President Obama’s Policies Aren’t Working:
Growth Estimates For The Second Quarter Badly Underperformed Economists’ Projections. “The U.S. economy grew less than forecast in the second quarter, after almost coming to a halt at the start of the year, as consumers retrenched. Gross domestic product rose at a 1.3 percent annual rate following a 0.4 percent gain in the prior quarter that was less than previously estimated, Commerce Department figures showed today in Washington. The median forecast of economists surveyed by Bloomberg News called for a 1.8 percent increase.”

• “Consumer Spending From April Through June Showed The Smallest Gain Since The Second Quarter Of 2009, When The Economy Was In Recession.”

The Government Also Issued Major Downward Growth Revisions For The Previous Two Quarters, Suggesting A “Troubling And Fundamental Slowdown Might Be Underway.” “The Commerce Department data on Friday also showed the current lull in the economy began earlier than had been thought, with the growth losing steam late last year. … First-quarter output was sharply revised down to a 0.4 percent pace from a 1.9 percent increase. … Fourth-quarter growth was revised to a 2.3 percent rate from 3.1 percent. … The sharp downward revisions to the prior quarters [suggests] a more troubling and fundamental slowdown might be underway.”

• “The U.S. Economy Came Perilously Close To Flat-Lining In The First Quarter…”

GDP Estimates Were Not This Morning’s Only Disappointing News:

Continue reading here.

● What economists are saying:

TIM GHRISKEY, CHIEF INVESTMENT OFFICER OF SOLARIS ASSET MANAGEMENT IN BEDFORD HILLS, NEW YORK:

Everybody expected GDP to be weak for the second quarter, estimates had steadily come down, but this is a pretty shockingly low number. The revision to the first quarter is even more shocking.”

“Clearly this is evidence of a mid-cycle slowdown. The only question now is do we see a pick up in the second half and so far the economic data to date doesn’t suggest that.”

SCOTT BROWN, CHIEF ECONOMIST, RAYMOND JAMES, ST. PETERSBURG, FL

“The face value is certainly not great. The second quarter disappointed, but the first-quarter downward revision is more disturbing. It advances the pangs of concern. The debt ceiling nonsense is not going to help us. We’re already in an economy that is subpar.”

STEVE BLITZ, DIRECTOR AND SENIOR ECONOMIST, ITG NEW YORK

“The economy is weak, and it’s going to stay weak, and it’s going to stay weak for a while because we are in the process of deleveraging and this is what deleveraging looks like. To get the economy moving forward the way it should requires a reform of the tax code that will lower rates and broaden the base and favor investment over consumption. Efforts to try and put Humpty Dumpty back together again to have the economy we had before is not going to work.

“I’m not going to say there can’t be any growth in the second half of the year. Remember the fiscal stimulus has petered out. You don’t have the Fed’s QE2 pushing liquidity into the system and you have slower growth globally. It’s hard to add these things up and say that the U.S. economy is going to accelerate in the second half of the year.”

OMER ESINER, CHIEF MARKET ANALYST, COMMONWEALTH FOREIGN EXCHANGE, WASHINGTON

“Very weak number in GDP. The headline was well below forecast and surprisingly we saw very large downward revision to Q1’s data. So it looks like a lot of this was driven by a sharp falloff in consumer spending in the second quarter, which only rose by 0.1 percent. Overall, a very weak number.




As we await the outcome of the debt ceiling debacle debate, the dreary GDP report increases the likelihood that America’s financial reputation will be downgraded. A weak economy means a greater deficit.

We need Mitt Romney’s leadership in the White House. Read his Seven Rules for Successful Economies here.


► Jayde Wyatt