Investors now see Australia as a better place to invest than the USA or Germany.

[Humodour]

http://www.bloomberg.com/news/2011-07-28/a...-s-germany.html

 

Interesting situation.

[Morgoth]

Meanwhile Congress still hasn't come to agreement to raise the debt ceiling.

 

This is gonna be interesting.

 

Why doesn't the US just admit they're already bancrupt and ready to default?

[Gorth]

Why doesn't the US just admit they're already bancrupt and ready to default?

Why don't they just sell Alaska back to the Russians (or sell it to the Chinese for that matter). I seem to remember reading somewhere, that it is the greatest money pit and most subsidized by federal tax money place in the US

 

I'm investing in Australia too... bought some beer and a few bottles of wine

[Morgoth]

I'm investing in Australia too... bought some beer and a few bottles of wine

Australia is cultivating vine grapes?

 

I didn't know there's even growing something down there...

[Gorth]

I'm investing in Australia too... bought some beer and a few bottles of wine

Australia is cultivating vine grapes?

 

I didn't know there's even growing something down there...

They grow more than just spiders and kangaroos

[Fleapants]

Aussie wine is excellent

[Nightshape]

yeah, shame the games industry sucks out in aussie land

[Walsingham]

Why doesn't the US just admit they're already bancrupt and ready to default?

Why don't they just sell Alaska back to the Russians (or sell it to the Chinese for that matter). I seem to remember reading somewhere, that it is the greatest money pit and most subsidized by federal tax money place in the US

 

I'm investing in Australia too... bought some beer and a few bottles of wine

 

Don't you ****ing dare! Alaska is awesome. They should sell off New York It's not really American in the first place.

[ShadySands]

Hey! New York is awesome. I vote we get rid of New Jersey.

[Malcador]

Sell Florida, lose old people and meshbacks.

[ShadySands]

That's my second choice. Maybe we can do a package deal

[Orogun01]

Sell Florida, lose old people and meshbacks.

To the british please.

[Enoch]

Here's the core of the current U.S. debt crisis: a number in section 3101(b) of Title 31 of the United States Code is too low. It takes a simple act of Congress to amend the U.S. Code. That's it. The only question is how large a pound of flesh the various factions in Congress are able to extract in exchange for their "yes" vote. (And how soon we'll be back in the same situation again, as they don't have the sense to just abolish the limit and be done with it.) Yes, the aggregate level of federal debt is higher than I'd like it to be, but, based on the judgment of the marketplace, which is still willing to buy Treasuries at quite a low risk premium, it's certainly not high enough to constitute a "crisis" absent the artificial statutory limit.

 

 

About Australia, I get it. It's a stable developed economy, with generally sensible governance and reasonable debt levels, that isn't going through the current political troubles that America is or the intra-eurozone problems that burden the big economies on the Continent. And it has been a major beneficiary of the huge Chinese fiscal stimulus, given how much of its economy is resource-extraction-based and how much of those resources are sold to the PRC, helping it get through the current global downturn better than most.

 

(In some circles, investment in Australia is actually used as a proxy for investment in China. Because, as I mentioned, relative to other stable, developed nations, Australia's economy is pretty heavily focused on raw materials extraction and export, and because the chief buyers for those exported materials are in China, the variation between the Aussie economy and that of the rest of the developed world tends to be driven heavily by the level of Chinese demand for raw materials. So, if one projects further growth in China, investing in Australia is a way to profit from it without exposing one's self to the political and corporate-governance risks that direct Chinese investment often brings.)

Edited July 30, 2011 by Enoch

[Wrath of Dagon]

Here's the core of the current U.S. debt crisis: a number in section 3101(b) of Title 31 of the United States Code is too low. It takes a simple act of Congress to amend the U.S. Code. That's it. The only question is how large a pound of flesh the various factions in Congress are able to extract in exchange for their "yes" vote. (And how soon we'll be back in the same situation again, as they don't have the sense to just abolish the limit and be done with it.) Yes, the aggregate level of federal debt is higher than I'd like it to be, but, based on the judgment of the marketplace, which is still willing to buy Treasuries at quite a low risk premium, it's certainly not high enough to constitute a "crisis" absent the artificial statutory limit.

The marketplace didn't think there was a crisis in mortgage securities either until the whole thing collapsed. I'd say financing 40% of your budget through borrowing with no end in sight is a crisis, and that's even before social security and medicare turn to deficits instead of surpluses.

[Calax]

Here's the core of the current U.S. debt crisis: a number in section 3101(b) of Title 31 of the United States Code is too low. It takes a simple act of Congress to amend the U.S. Code. That's it. The only question is how large a pound of flesh the various factions in Congress are able to extract in exchange for their "yes" vote. (And how soon we'll be back in the same situation again, as they don't have the sense to just abolish the limit and be done with it.) Yes, the aggregate level of federal debt is higher than I'd like it to be, but, based on the judgment of the marketplace, which is still willing to buy Treasuries at quite a low risk premium, it's certainly not high enough to constitute a "crisis" absent the artificial statutory limit.

The marketplace didn't think there was a crisis in mortgage securities either until the whole thing collapsed. I'd say financing 40% of your budget through borrowing with no end in sight is a crisis, and that's even before social security and medicare turn to deficits instead of surpluses.

Well... and this is silly... we wouldn't be in this position if the same people pushing us towards a default hadn't blocked moves to try to raise revenue via tax increases on the top 3%

[Guard Dog]

Here's the core of the current U.S. debt crisis: a number in section 3101(b) of Title 31 of the United States Code is too low. It takes a simple act of Congress to amend the U.S. Code. That's it. The only question is how large a pound of flesh the various factions in Congress are able to extract in exchange for their "yes" vote. (And how soon we'll be back in the same situation again, as they don't have the sense to just abolish the limit and be done with it.) Yes, the aggregate level of federal debt is higher than I'd like it to be, but, based on the judgment of the marketplace, which is still willing to buy Treasuries at quite a low risk premium, it's certainly not high enough to constitute a "crisis" absent the artificial statutory limit.

Speaking only for myself I would not buy US Bonds right now if they took dried coyote poop as payment. But it is not because of the current "crisis" which as Enoch correctly points out is a made-up political theatre event. No I am convinced the US will without question spend itself into insolvency at some point in the not too distant future but it will not be next week. Right now the only investments I think are safe is real estate (which is never the wrong way to go) and commodities. But real commodities are over priced right now so be ready to sell before everyone realizes the world is not ending.

[Wrath of Dagon]

Here's the core of the current U.S. debt crisis: a number in section 3101(b) of Title 31 of the United States Code is too low. It takes a simple act of Congress to amend the U.S. Code. That's it. The only question is how large a pound of flesh the various factions in Congress are able to extract in exchange for their "yes" vote. (And how soon we'll be back in the same situation again, as they don't have the sense to just abolish the limit and be done with it.) Yes, the aggregate level of federal debt is higher than I'd like it to be, but, based on the judgment of the marketplace, which is still willing to buy Treasuries at quite a low risk premium, it's certainly not high enough to constitute a "crisis" absent the artificial statutory limit.

The marketplace didn't think there was a crisis in mortgage securities either until the whole thing collapsed. I'd say financing 40% of your budget through borrowing with no end in sight is a crisis, and that's even before social security and medicare turn to deficits instead of surpluses.

Well... and this is silly... we wouldn't be in this position if the same people pushing us towards a default hadn't blocked moves to try to raise revenue via tax increases on the top 3%

Why don't we increase taxes on you instead? Why do people always assume someone else needs to pay for them?

[Morgoth]

You're not getting out of this mess without cutting defense spending significantly, and raising taxes all across the board.

 

But then again there's a presidential election coming up, so none of these measurments will be done.

 

Good night, America!

[Nepenthe]

Here's the core of the current U.S. debt crisis: a number in section 3101(b) of Title 31 of the United States Code is too low. It takes a simple act of Congress to amend the U.S. Code. That's it. The only question is how large a pound of flesh the various factions in Congress are able to extract in exchange for their "yes" vote. (And how soon we'll be back in the same situation again, as they don't have the sense to just abolish the limit and be done with it.) Yes, the aggregate level of federal debt is higher than I'd like it to be, but, based on the judgment of the marketplace, which is still willing to buy Treasuries at quite a low risk premium, it's certainly not high enough to constitute a "crisis" absent the artificial statutory limit.

The marketplace didn't think there was a crisis in mortgage securities either until the whole thing collapsed. I'd say financing 40% of your budget through borrowing with no end in sight is a crisis, and that's even before social security and medicare turn to deficits instead of surpluses.

Well... and this is silly... we wouldn't be in this position if the same people pushing us towards a default hadn't blocked moves to try to raise revenue via tax increases on the top 3%

Why don't we increase taxes on you instead? Why do people always assume someone else needs to pay for them?

'coz even Adam Smith understood the advantages of progressive taxation.

 

I don't mind paying taxes. I mind people with more money than I have spending a part of the money on corruption, so that politicians will give them tax cuts.

[Calax]

Here's the core of the current U.S. debt crisis: a number in section 3101(b) of Title 31 of the United States Code is too low. It takes a simple act of Congress to amend the U.S. Code. That's it. The only question is how large a pound of flesh the various factions in Congress are able to extract in exchange for their "yes" vote. (And how soon we'll be back in the same situation again, as they don't have the sense to just abolish the limit and be done with it.) Yes, the aggregate level of federal debt is higher than I'd like it to be, but, based on the judgment of the marketplace, which is still willing to buy Treasuries at quite a low risk premium, it's certainly not high enough to constitute a "crisis" absent the artificial statutory limit.

The marketplace didn't think there was a crisis in mortgage securities either until the whole thing collapsed. I'd say financing 40% of your budget through borrowing with no end in sight is a crisis, and that's even before social security and medicare turn to deficits instead of surpluses.

Well... and this is silly... we wouldn't be in this position if the same people pushing us towards a default hadn't blocked moves to try to raise revenue via tax increases on the top 3%

Why don't we increase taxes on you instead? Why do people always assume someone else needs to pay for them?

Well, among other things, right now I'm below the poverty line technically.

 

And because bumping up the taxes on the top three percent a very small number of points will create more revenue than kicking up the number of taxes on the lower economic demographics by a not-insignificant margin.

[Walsingham]

I think it's ironic that I seem to be the only person who is sad that the USA has been bungholed. I quite like the USA. I very much like not having the world economy collapse like an Iranian general's breath.

[Enoch]

I think it's ironic that I seem to be the only person who is sad that the USA has been bungholed. I quite like the USA. I very much like not having the world economy collapse like an Iranian general's breath.

Hey, it could be worse. The U.S. could be in as bad a situation as the Eurozone is.

 

 

Anyhow, it looks as if the immediate debt-limit faux-crisis has been averted (pending the Senate vote tomorrow). The austerity measures will hurt, certainly-- even if certain spending is wasteful from a particular point of view, it's a profit for somebody, and taking it away means taking away income, jobs, and GDP. (Sure, there are areas where the government is doing a lot more than it should, but that doesn't mean that the transition to them doing less won't be painful.) And, the political process being what it is, when the details are hammered out, they probably won't do much to get at the real reason why America's long-term fiscal situation is a problem-- that would involve tackling health care costs in a meaningful way, which would anger too many people both on the left (medicare/medicaid beneficiaries) and on the right (healthcare providers and the pharmaceutical industry).

[Enoch]

Also, I just took a look at the legislation that will actually address the debt limit issue, and now I need another drink. It's going to be causing a lot of work-related headaches for me over the next few months. I mean, the core provisions were passed as amendments to the Balanced Budget and Emergency Deficit Control Act of 1985! (Which, ironically, is what Congress produced the last time that there was a self-inflicted "crisis" because the opposition tied the nation to the railroad tracks and demanded a ransom before voting to raise the debt limit.) So, now, every time I need to understand part of the new law, I'm going to have to find the text of a 25-year-old law, along with all the amendments and legal interpretations (at least part of the original has been ruled unconstitutional by the Supreme Court) it has gathered over the years to find definitions sections and other important context.

[Walsingham]

With Italy tanking I'm asking myself for the first time if it's worth going abroad, lungfish style. Just hole up somewhere dirt cheap and full of mosquitos with a shotgun and plenty of rum. Live on ...I've no idea. Come back in five years when the dust has settled.

[Humodour]

With Italy tanking I'm asking myself for the first time if it's worth going abroad, lungfish style. Just hole up somewhere dirt cheap and full of mosquitos with a shotgun and plenty of rum. Live on ...I've no idea. Come back in five years when the dust has settled.

 

There is always Australia.