The article Global Bonds Gain $132 Billion as Stock Rout Cuts $7.8 Trillion says (among other things),
… yesterday’s stock rout wiped out about $2.5 trillion in global equity values, extending total losses since July 26 to $7.8 trillion.
Put this together with the words in the Standard & Poors downgrade of the US credit rating:
Compared with previous projections, our revised base case scenario now assumes that the 2001 and 2003 tax cuts, due to expire by the end of 2012, remain in place. We have changed our assumption on this because the majority of Republicans in Congress continue to resist any measure that would raise revenues, a position we believe Congress reinforced by passing the act.
I think that S & P is only looking for a couple of trillion dollars more of deficit reduction. Wouldn’t it have been cheaper even for the wealthy to have raised their taxes instead of making them lose trillions of dollars in the stock market?
My friend JohnK said the following:
I think any increase in consumer interest rates as a result of the downgrade should be called the “Tea Party Tax Increase, or, in Washington parlance, the “TPTI”.
I would just change that to say that this loss of wealth could be dubbed the TPTI.
Notice that I classify this post under the category of Greenberg’s Law of The Media which states that “if a news item has a number in it, then it is probably misleading.”