Thursday, November 11, 2010

The shot never heard 'round the world

I think we have a new shot heard around the world, but it’s being silenced so that everyone will keep confidence. There’s a story that has been pushed to the back page and bottom of the pile. You would have to really search or like I did stumble upon it. In my article “Federal Reserve Bankrupting America” you will see the beginning. In 1997 China created its own global credit rating agency called the Dagong. Since China is an emerging power and smart investor, they needed a system that would put their views to the world out in the open.


On July 13th of this year Reuters reported that the Chinese Dagong credit rating agency downgraded the US credit rating from AAA to AA. Since the Dagong is not globally recognized as a credit rating agency this was pushed to the back of the news. No one in the news reported this or even made mention of this. Not even Wall Street has paid attention to this.

In September of this year the Chinese Dagong credit rating agency applied to the SEC to become a globally recognized credit rating agency. The SEC due to regulation created as soon as the Democrats came into power in 2007, the Dagong was denied entry. This is where I start to smell a rat. The big 3 credit rating agencies still give the US dollar an AAA rating although the Chinese and the rest of the world are starting to lose confidence, especially after we’ve spent almost $6 trillion in the last 4 years under the Pelosi Speakership. The rest of the world has been warning us for some time that our debt is undermining the value of the US Dollar. The biggest red flag for me is that the big 3 credit rating agencies Moody’s, S&P, and Fitch still keep the US credit rating at AAA. Is there a reason for this, and what are the regulations that are preventing a major and emerging global lender from having any real input in the world market as far as credit ratings?

On November 9th of this year the Chinese Dagong credit rating agency lowered the US credit rating again from AA to A+. Have we heard anything about this, the answer is no. Will we hear about this, the answer is still no. Is the rest of the world paying attention, probably not. This rating change could be seen as political in nature considering the US has been devaluing the dollar to force revaluation of the Chinese Yuen. This could also be the signal to the US that we need to start paying off our debt and really acting like a responsible adult instead of a spoiled kid with an endless credit card.

As long as the Dagong credit rating agency is being kept under wraps we’re just heading towards another bubble. Could this bubble be the straw that breaks the camel’s back? Although the big 3 are telling the rest of the world that the US dollar is strong, this could be disastrous. China’s Dagong may actually be a fair credit rating agency, although it is being controlled somewhat by the state. The Chinese are a different culture than the rest of the world, so we just don’t understand that Chinese investors are more likely to listen to the Dagong credit rating agency before they listen to any US based credit rating agency. This could very well be what Glenn Beck was talking about when he said “China may stop buying US Bonds” on his November 5th show on FNC. If the Chinese investor decides to follow the Dagong credit ratings instead of the big 3 given to us by a US government agency the SEC, this could very well get ugly soon. If the US does not heed these warnings we are at the peak of a very ugly road.

My final thoughts will be short and simple. There’s a rat, I can smell it. Why does the Federal government get to use double standards on everything? We complain about the Chinese undervaluing their currency, but then we do something like QE2? Why do we get to choose who we recognize to rate our credit and use a government agency to prop up a failing dollar, but we refuse to acknowledge the truth. This is just the tip of the iceberg. I will be researching the rest of the weekend and come out with an expose on these regulations that favor the US and could possibly be our demise and I also want to know why the Degong has lowered the US credit ratings to see what other motives there are. I personally think that they’re right on target, but there could be more to it. Please tune in on Monday and I will have even more information to this big puzzle while we watch our dollar collapse.



Sources:

http://online.wsj.com/article/SB10001424052748704082104575515470951666514.html

http://ftalphaville.ft.com/blog/2010/09/27/353781/dagong-fires-back/

http://seekingalpha.com/instablog/679135-sun-kai/84377-china-s-new-credit-rating-agency-trouble-for-the-big-three

http://www.bloomberg.com/news/2010-11-09/china-s-dagong-downgrades-u-s-to-a-on-quantitative-easing-xinhua-says.html

3 comments:

dennis hodgson said...
Friday, 12 November, 2010

The big mistake that America made was to bail out the banks and other financial institutions. They should have been allowed to fail. There would have been fallout, certainly, but the country wouldn't now be so far in debt and would be well on the way to recovery.

As far as China is concerned, there is a good chance that it will stop buying US bonds, because the Chinese don't like risky investments.

This link provides a series of background articles on China.

Hegrins said...
Friday, 12 November, 2010

Dennis, I agree with you. This too big to fail is going to be the demise of the rest of the world because they're doing it with Greece. I don't think anyone here in the US will care about our debt until the big 3 lower our credit rating.

Stephshoots said...
Monday, 15 November, 2010

The problem is simply that our government is corrupt. It's not just that the banks have a strong financial pull on the government IN EVERY BRANCH, as has always been the case. But right now THE BANKS= THE GOVERNMENT.

Paulson, Geithner, Bernacke, et. al. are the evil dictators. They are DELIBERATELY squeezing the middle class. They are the captains DELIBERATELY sinking the ship. How do we know it's deliberate?

We know because all of the laws put into place to protect us after the Savings and Loan Crisis of the early 1990s were DELIBERATELY changed and unraveled just before the current bubble. After the S&L Crisis, some 1500+ people were arrested.

Recently, there have been no prosecutions, no arrests made. Why? Because as soon as an investigation is made, the guilty are implicated.

We also know that this is deliberate because the International Monetary Fund has performed these acts on other nations, deliberately impoverishing them. BofA, Goldman Sachs, JP Morgan, et. al. are playing a big video game, creating empires. Except the empires are real. The Brotherhood of international banks is indifferent to human suffering.

The recent QE2 underscores the veracity of what is going on. The price of food and gas will rise, along with unemployment, causing more foreclosures and more defaulting on debt.

Getsmartaboutbanks.com is an excellent site exploring posts from all over the place that explain the criminality in detail.

That's why some are saying American Revolution II. What we need to fight here is a lot more evil than the crown of England ever was..,.

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