Snapshots from the Downgrade Presidency
From Chartsbin, my new favorite website, three interesting and depressing snapshots. The first, public debt as a percentage of GDP across the world:
Here's the company we're in: Sudan, Nicaragua, and, interestingly, Japan. (Japan, of course, tried to shake itself out of the economic doldrums a decade or so ago, by massive increases in public spending. Didn't work out so well for them, either....)
Here's how S&P currently rates the world's creditworthiness:
Considering the chart at the top, I think they're going easy on us. Light blue is a soothing, non-controversial color. It's also the same color as China, Japan, and Spain. (Also, bizarrely, Saudi Arabia. Why are they light blue? I'd have thought with all of that collateral buried in the sand they'd be dark blue for sure....)
Here's how Dagong, the Chinese rating agency -- get used to saying that, by that way -- rates global government debt:
We're still light blue, but joining us is Russia, Brazil, South Africa, and the UK. In the dark blue category, no surprise, is China. The risk-analysis gang at Dagong, presumably, knows which side of the bread the butter's on.
But still: for a country that's indebted itself to almost 100% of its GDP, these guys are going kind of easy on us. For all of the complaints about S&P's terrible track record -- their shoddy, easy-A ratings were a big reason the mortgage-backed securities business exploded -- they clearly haven't learned their lesson. They're still pretty easy to dupe.
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Comments :
Dec '10
Re: Snapshots from the Downgrade Presidency
Shouldn't Ricochet be your favorite website?
May '10
Re: Snapshots from the Downgrade Presidency
S&P and the other ratings agencies are late to the game. They should have downgraded us a long time ago if they were serious.
The fact that the S&P did downgrade us actually means they are halfway trying to recover from having put on blinders before the past recession. But they are still too timid. We should have been downgraded before.
Here's another scary chart: Approaching the Crossover Point
We're already at the crossover point where our debt passes national GDP. That's pretty much the point of no return given the compounding of interest and the lack of political will to change course drastically. We should have changed course in the 80s, but didn't. We should have changed course in the 90s, but didn't. In the 2000s we really went crazy. What were the Republicans thinking-- another new Medicare benefit? No wonder they got whipped in 2006.
The longer we delayed, the harder the turnaround. A default is inevitable now.
Edited on Aug 8, 2011 at 1:57pmOct '10
Re: Snapshots from the Downgrade Presidency
I enjoy seeing all the charts, graphs, and other data you post but I wonder where you find this stuff. I'm a pretty good Internet surfer but you find things I never would imagine to look for.
May '11
Re: Snapshots from the Downgrade Presidency
"My new favorite website" You are feeding an addiction that is getting out of control for me. I am feeling guilty for abandoning my old favorite websites. What is an information junkie to do? "Dagong, the Chinese rating agency, get used to saying that." Does it rhymes with Doggone?
Dec '10
Re: Snapshots from the Downgrade Presidency
Holding the world's reserve currency is saving our keisters from further downgrade... for the moment.
May '10
Re: Snapshots from the Downgrade Presidency
We have also long had the benefit of a stable political system and a vibrant economy...uh...yea.