NEW YORK — A Fitch Ratings executive said Thursday that the firm would likely downgrade US debt if the federal government does not get its fiscal house in order.
Speaking at the firm’s global banking conference in New York, Fitch sovereign group managing director Ed Parker said “the US does not have a credible fiscal consolidation plan” and that “if we don’t see one after the election, I would expect a downgrade.”
Again, as I noted earlier today, the choices are not binary between “more stimulus” and “austerity.” The choice is in fact between a severe contraction now or a worse one later. In the “now” situation the banksters who are insolvent go out of business; in the “later” situation they attempt to remain solvent by stealing as much as is possible from you first!
The correct choice is to:
- Shut down the derivative casino. Right here, right now. Force all contracts onto exchanges and force the posting of cash margin against every undrewater position or the contract is canceled as fraudulent. This does not impugn contract rights as a contract you cannot perform on is no contract at all; it is an active fraud.
- Remove excess liquidity. If The Fed refuses, strip their power to avoid doing so. The active theft of purchasing power through deficit spending must be stopped; what is going on now is transfer of your wealth and income, using the jackboot of government, to banksters that would otherwise be exposed as insolvent.
- Balance the budget — right now. That which the people will not pay for in current taxes they cannot have. Period.
- Remove all special protection for derivatives and other debt-holders. If you hold debt and the other side can’t pay, you lose your money. Too bad, so sad.
- Accept that the promises made in pension and related programs cannot be kept — they were lies at the outset and cannot be made truths. Half, a third or a quarter of a loaf is better than nothing, which is what we all get if the economy and government collapses.
We must accept the economic and credit contraction that must occur. This cannot be avoided. Our choices are to either keep trying to bail out the banksters who are still insolvent and eventually collapse with everyone being impoverished first, or to tell the banksters to stick it and take the contraction anyway.
There is no third choice in which the contraction doesn’t happen, but in one case we keep a solvent government and in the other we wind up like Greece.