Debt — EU, US, China

First, McClatchy explains why Germany has to worry more about the debt of Greece, Portugal and Spain than it is letting on, or wants to — it's called credit default swaps on one country's lending to another.

Germany will have to backstop Greece et al in some way, shape or form.

Second, little Timmy G. says the U.S. will never lose its AAA bond rating because, in essence, it's too big to fail.

Well, the real reason is because all the bond rating agencies are in the U.S. and because the dollar is the global reserve currency.

BUT — what if Beijing wins its push for a backup reserve currency? Even more, what if China's national sovereign wealth fund starts its own ratings agency?

Wipe that smile off your face, Mr. Treasury Secretary.

Yea! We’re dead last

In how indebted we are. The U.S. current accounts debt is bigger than the current accounts surplus of China, Japan, Germany, Russia, Saudi Arabia and Norway — the six largest countries in terms of current account surpluses — combined!

This is Shrub’s massive budget deficits, but it’s more than that. It’s people buying more house then they can afford, launching massive home equity loans, buying more car than they can afford (now courtesy of six-year payment plans) and more.

Yes, some of this is a middle class with stagnant wages wanting to keep up with the richer Joneses. But, all that does is feed the monster of job-shedding, finance-chopping U.S. companies.

China sighs, Dow sags

Anybody who doesn’t believe BushCo’s massive, Chinese-financed debt is a long-term Sword of Damocles should think again The Shanghai stock market gives up 9 percent, and the Dow and other industrialized exchanges get tugged down with it.

This also illustrates how “Wall Street” is NOT real capitalism, nor reflective of the working person’s economy.

Self-interested, self-serving CEOs and boards of directors have trading caps when the Dow starts falling, but let it rise exorbitantly and “hey, that’s great.” If the Street had caps in both directions, we might have avoided the dot-com bubble.

But that wouldn’t be self-serving enough.