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Downgrading Obama

- April 25, 2011

Obama’s Mismanagement Has Investors, Foreign Nations Planning For A Future With A Weakened, Indebted America

CITING A WEAK DOLLAR AND FISCAL MISMANAGEMENT, WARREN BUFFETT AND OTHER INVESTORS ARE LOOKING OVERSEAS FOR BETTER RETURNS

Obama’s Ally, Warren Buffet, Is Betting Against The U.S. In An Overseas Search For Investment Opportunities. “Last month, Warren Buffett went shopping — abroad. … This is Buffett’s way of betting against the U.S. dollar. Armed with about $38 billion of cash at Berkshire Hathaway, he can use dollars now to buy companies that will generate profits in other currencies for years to come.” (Steve Mufson, “The Dollar, Less Almighty: Big Investors See Possible Long-Term Currency Weakness,” The Washington Post, 4/22/11)

“Buffett Isn’t Alone” As Investors Facing Worries Over Deficits, Debt And Inflation In The U.S. Look Abroad For Bigger Returns. “Buffett isn’t alone. Some of the most successful investors in the United States and the biggest money management funds are worried that trade deficits, big budget deficits and the possibility of renewed inflation will make the U.S. dollar a weak currency compared with others around the world. On Thursday, the dollar fell to an 18 1/2-month low against the euro.” (Steve Mufson, “The Dollar, Less Almighty: Big Investors See Possible Long-Term Currency Weakness,” The Washington Post, 4/22/11)

Pimco Has “Dumped Its Entire Holdings Of U.S. Treasury Bonds.” “Bill Gross, chief executive of the giant bond investment firm Pimco, said its flagship Total Return Fund has 8 percent of its assets — a historic high — in issues denominated in currencies other than the dollar. Earlier this year, the fund dumped its entire holdings of U.S. Treasury bonds, according to disclosures.” (Steve Mufson, “The Dollar, Less Almighty: Big Investors See Possible Long-Term Currency Weakness,” The Washington Post, 4/22/11)

  • PIMCO’s CEO Bill Gross: “Gross Said The Decline Of The Dollar Is Part Of A Longer-Term Trend Pimco Calls ‘The New Normal.’” (Steve Mufson, “The Dollar, Less Almighty: Big Investors See Possible Long-Term Currency Weakness,” The Washington Post, 4/22/11)

STANDARD & POOR’S, IMF LOSING CONFIDENCE IN AMERICA, WARNING OF AN END TO THE “AGE OF AMERICA” AND OUR “STERLING CREDIT RATING"

strong> IMF Predicts The End Of The “Age Of America.” “For the first time, the international organization has set a date for the moment when the ‘Age of America’ will end and the U.S. economy will be overtaken by that of China.” (Brett Arends, “IMF Bombshell: Age Of America Nears End,” The Wall Street Journal’s “MarketWatch”, 4/25/11)

  • “According To The Latest IMF Official Forecasts, China’s Economy Will Surpass That Of America In Real Terms In 2016 — Just Five Years From Now.” (Brett Arends, “IMF Bombshell: Age Of America Nears End,” The Wall Street Journal’s “MarketWatch”, 4/25/11)

Standard & Poor’s Warns U.S. “To Get A Grip On Its Finances Or Risk Losing The Nation’s Sterling Credit Rating.” “A key credit agency issued an unprecedented warning to the United States government Monday, urging Washington to get a grip on its finances or risk losing the nation's sterling credit rating.” (Paul Wiseman, “S&P Warning: Fix Deficit Or Risk Credit Downgrade,” The Associated Press, 4/19/11)

  • The First Time The S&P Has Downgraded The U.S. “For the first time, Standard & Poor's lowered its long-term outlook for the federal government's fiscal health from ‘stable’ to ‘negative,’ and warned of serious consequences if lawmakers fail to reach a deal to control the massive federal deficit.” (Paul Wiseman, “S&P Warning: Fix Deficit Or Risk Credit Downgrade,” The Associated Press, 4/19/11)

WHEN IT COMES TO OUR DEBT, EVEN CHINA IS LECTURING 
OBAMA TO “ADOPT RESPONSIBLE POLICIES”

China Lectures The U.S. To “Adopt Responsible Policies” Concerning Our Deficits To Protect Owners Of U.S. Debt. “‘We hope the U.S. government earnestly adopts responsible policies and measures to protect the interests of investors,’ Chinese Foreign Ministry spokesman Hong Lei said Tuesday, according to a Wall Street Journal report. The comments came after S&P this week downgraded its outlook on U.S. government bonds to negative from stable.” (“China Urges ‘Responsible’ U.S. Action On Debt,” The Wall Street Journal’s “MarketWatch”, 4/19/11)

  • “China, Armed With Foreign Exchange Reserves Of More Than $3 Trillion, Owns More Than $1 Trillion Of U.S. Government Debt.” (“China Urges ‘Responsible’ U.S. Action On Debt,” The Wall Street Journal’s “MarketWatch”, 4/19/11)

China’s Central Bank Warns Its Government To Prepare For “Volatility In U.S. Treasury Prices” Citing The Risk That Bond Markets Could Lose Confidence In Our Ability To Repay Our Debts. “China needs to guard against volatility in U.S. Treasury prices should investors demand higher returns from U.S. government debt, a researcher at the Chinese central bank said on Monday. Zhang Jianhua, a head of research at the People's Bank of China, said worries that the heavily indebted U.S. government may not repay its debt could drive Treasury yields higher and cause U.S. debt prices to fluctuate.” (Koh Gui Qing, “China Must Watch For Rising U.S. Treasury Yields: Researcher,” Reuters, 4/25/11) 

  • The “Gigantic-And-Growing Market” For U.S. Treasuries Is “A Sign Of Poor U.S. Fiscal Health.” “Due in part to its size, the U.S. Treasury market is deemed to be among the safest in the world as it allows investors to buy and sell without prices swinging too much. But the gigantic-and-growing market is also a sign of poor U.S. fiscal health.” (Koh Gui Qing, “China Must Watch For Rising U.S. Treasury Yields: Researcher,” Reuters, 4/25/11)
  • “China Owned $1.154 Trillion In U.S. Government Debt In February, U.S. Data Showed.” (Koh Gui Qing, “China Must Watch For Rising U.S. Treasury Yields: Researcher,” Reuters, 4/25/11)

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