Credit rating agency Standard & Poor’s (S&P) downgraded to “negative” today its outlook on the United States sovereign debt, citing the risk that the government will be unable to curb rising debt and the growing deficit.
According to the New York-based credit rating agency:
Because the U.S. has, relative to its AAA peers, what we consider to be very large budget deficits and rising government indebtedness, and the path to addressing these is not clear to us, we have revised our outlook on the long-term rating to negative from stable.
US deficit grew to 11% of GDP
The credit rating agency points to the growing US deficit, which “ballooned” to more than 11% of gross domestic product (GDP) in 2009 from around 2%-5% during the past decade.
The downgrade also stems from what S&P sees is a risk that policy makers might fail to agree on how to address the country’s budget and finances, leaving the US fiscally weaker relative to other AAA-rated countries.
Debate on fiscal policy
President Barack Obama and the Democrats are currently in the middle of heated debates with congressional Republicans over how to address the fiscal problem. The White House proposed a mix of tax increases and spending cuts, while Republicans are asking for reductions in both spending and taxes which would supposedly help boost the flagging US economy.
On April 8, the Obama administration narrowly averted a government shutdown when it struck a deal with the Republicans regarding the current year’s budget.
The debate has now shifted to the cap on government debt which the government will breach by May this year. Democrats are asking to raise the $14.29 trillion debt ceiling while Republicans are demanding more budget cuts before they agree to lifting the cap. If the ceiling is not raised, the US government might default on the interest payments of some of its debts.
“AAA” bond rating at risk
S&P also warned that if no credible and clear plans are finalized and implemented by 2013, it will lower the US sovereign bond rating, currently rated “AAA.”
AAA is the highest rating on an issued bond which a borrowing entity like the government uses to lower its borrowing cost, that is, the high bond rating can be used to borrow at reduced interest rates.
Says S&P:
We believe there is a material risk that US policymakers might not reach an agreement on how to address medium- and long-term budgetary challenges by 2013. If an agreement is not reached and meaningful implementation is not begun by then, this would in our view render the US fiscal profile meaningfully weaker than that of peer ‘AAA’ sovereigns.
Impact of credit rating downgrade
Should S&P push through with lowering the AAA long-term rating of the United States, this would leave Germany and France as the only countries with a higher rating, threatening the dominance of the US as a global economic powerhouse.
Riskier US debt would also result to higher bond yields which would lead to increased borrowing costs in the form of higher mortgage rates, credit card interest rates, and business and personal loan interest rates.
The S&P outlook downgrade on April 18 sent stocks sharply lower. The Dow Jones shed 1.14% of its value, closing at 12,201.59.
S&P downgrades US outlook to 'negative'
About the Author
PSEi support seen at 6,200 and 6,000 amid weaker Peso
In a not-so-surprising move, the U.S. Federal Reserve (Fed) yesterday raised interest rates by 75 basis points (bps) or 0.75% in a bid to tame rising inflation in the United States. This was the third consecutive 0.75% rate hike by the Fed, which brings the federal funds rate, the central bank’s benchmark interest rate, to ... Read more
Official SWIFT Code of BDO, BPI, Metrobank, Philippine banks
When sending cash remittances or wire transfer to a bank account in the Philippines (such as BDO, BPI, Metrobank, Landbank, DBP, etc.), you’ll surely need the SWIFT Code of the bank. Look no further because you can find all the SWIFT Codes you need in this list! Make sure you’re using the right bank code ... Read more
How to Waive your Credit Card Annual Fee (BDO, BPI, Metrobank, RCBC, Citibank, UnionBank)
Without a doubt, one of the most annoying fees that credit cardholders have to pay is the annual fee. Majority of cardholders are familiar with this fee and majority of us likely pay this grudgingly year after year after year. In the case of my credit card with BPI (Bank of the Philippine Islands), I’m ... Read more
Why Filipinos do not become business owners or entrepreneurs
For a majority of Filipinos, entrepreneurship does not seem to be a typical, expected path. This is not surprising, considering that in school, students are primarily taught to become employees after graduation. Students train for years to become staff workers, reporting to a supervisor, and just waiting to receive their wages or salaries every month. ... Read more
My experience investing in Mutual Funds in the Philippines
I started investing in mutual funds when I was 22 years old. As an Overseas Filipino Worker (OFW) then, I was fortunate to be able to save some money at that young age because of my work abroad. One time while I was on vacation in the Philippines, I saw a large billboard in EDSA ... Read more
Income Tax Tables in the Philippines (2022)
The Philippines’ new tax reform bill, known as TRAIN or Tax Reform for Acceleration and Inclusion, was signed into law on December 19, 2017 and its implementation began on January 1, 2018. What are the new income tax rates under the TRAIN law? How will TRAIN affect income taxes of individuals and corporations? How is the ... Read more
PSE Stocks Performance under each Philippine President (1987-2021)
Did you know that Philippine stocks were able to achieve an astounding growth of 800% in a span of 30 years? From 1987 until 2018, the Philippine Stock Exchange index (PSEi) rose from 1,000 points to a peak of 9,000 points — generating a return of 800% over 30 years. (The PSEi is an index ... Read more
SSL 2022: Salary Increases for Teachers, Nurses, Gov’t Employees
Good news to all government employees! There’s a new round of salary increases beginning January 1, 2022! Millions of employees of the Philippine government — including public school teachers, nurses and staff of government hospitals, and workers in local and national government agencies, etc. — will be getting an automatic salary adjustment this 2022 under ... Read more
PSE Trading Hours in 2022: What time open, when closed?
Before you take the plunge into stock trading and investing, make sure you understand what stocks are and how the Philippine Stock Exchange (PSE) operates. Unlike other investments that are relatively safe, stock trading is risky and loss of money is a possibility. So before you deep dive into the exciting world of stock trading, ... Read more
Price Floor and Price Ceiling of PSE Stocks
Trading bands in the PSE come in two forms: Price Ceiling, or the upper price limit, and Price Floor, or the lower price limit.
Gloomy news, but not surprising. The Global economy has changed, and US is having a harder time dealing with its own economic worries… Hey, if you are interested to learn how to make money through trading, check out this great site.
It is a fact that affiliate marketing is among the simplest and most efficient ways to generate income online. However, you will have to make an effort right until you can generate income from your affiliate business.
We’ve all heard stories of people making easy money online with auction sites like Clickbank, or by writing a blog, or by using Google AdSense, and quite a few other methods. Is it truly that easy? If you’re a newbie, then the answer is “no”. When you discover a proven system however, then it truly is feasible to make easy money online. My favourite approach for accomplishing this is with affiliate marketing. You must work hard if you want to achieve success and you will also have to apply certain tools in order to earn money.
1. Make a list of topics that you find intriguing.
2. Sign up with some affiliate networks and browse their product offerings.
3. Find affiliate products that are being successfully promoted by others. This can be done by searching the affiliate stats.
4. Find out if there’s a demand for the item you are thinking about promoting. This can be done with the Google AdWords Keyword Tool. It can show you how many times a specific keyword phrase is being searched for each month.
5. When you discover an item that meets all of these criteria then sign up as an affiliate. You’ll get a unique Id number that’s located in your link to the merchant’s web site. This identification number is what makes it possible for you to get paid.
6. Publish a Newsletter (Optional)
It amazes me how many people don’t capture email addresses on their site. Email marketing can be one of the most effective ways of creating loyalty and trust with your visitors.
Newsletter can keep your visitors informed with what’s new at your site, and it also provides you with the opportunity to market additional product and services to them.
What’s great about a newsletter subscriber is that they’ve already told you they like what you have to offer. They wouldn’t have given you their email address if they didn’t right? So it’s important you keep their interest so they don’t unsubscribe.
Don’t go for sales every time
Many people make the mistake of throwing to throw in too many sales pitches in their newsletter. If you appear as though you’re just trying to get your visitors to buy something every time you send out an email, they’ll catch on quickly and unsubscribe.
Now, there is the exception. If you own a shopping website then this rule doesn’t apply as much. Your visitors expect you to send information on new products in your store.
For example, when you sign up with Target.com’s newsletter, you expect them to send you deals and information on products on you can purchase on Target.com . What else would you do at Target.com but shop?
However, if you have an information website on how to play tennis, and in your newsletter you’re constantly trying to get people to buy from different sports stores you’re affiliated with, that’s a di9fferent story.
Eventually your subscribers will start to feel like they’re being pitched to over and over again. Pretty soon they’ll get the idea that you’re just trying to earn a commission and sell products.
Mix relevant information with product recommendations
It’s important that you find a nice mix providing quality information and soft selling. In other words, every email you send out should not be promoting something. Something you should just send out helpful information that your audience can use.
Then once and a while you can throw in a recommendation for a product you believe your subscribers will be interested in. This is where you plug the company you’re affiliated with.
Let’s say you send a newsletter on how to perfect your tennis swing. You can go through the techniques in your email and at the end you can recommend your favourite tennis video from amazon.com. This is where you send them to buy the video and Amaon.com’s affiliate program pays you.
So even though you are promoting a product, ou still began the email by offering them valuable information about the topic of tennis. What’s great is if you do this effectively, it doesn’t come off as “selling “. It just appears that you’re making a recommendation for a product you love.
I use Aweber
I tried running a newsletter script on my own server, but it was not very robust. Unless you are really into programming, i’d recommend using a third party site to manage our newsletter.
With Aweber, you can collect demographic information from your website visitors then they subscribe, and you can send targeted massages based upon the information you collect.
So for example, let’s say when people subscribe to your newsletter you ask them for their age and their sex. With aweber, you can send a targeted email out to females under the age of thirty if you wish.
Aweber also tracks click-thru rates for links inside your emails and they provide excellent reporting.
7. Learn from the top successful affiliate marketers that have succeeded as being affiliate marketers and copy the same exact methods and techniques that they’ve done.
Lastly, you’re going to need to develop a marketing plan. This doesn’t include things such as creating internet websites, writing articles, producing videos, advertising, or a combination of any or all of these techniques. You might wish to invest in a good affiliate marketing course to teach you about the numerous strategies available.
You can also discover the top secrets and methods made by one of the top successful affiliate marketers (Matt Keenan), that will take you on a step by step guide and discover how to generate big revenues using nothing but free traffic.
http://tinyurl.com/CBAWM
And you can also contact me on carltonlucas@hotmail.com I’ll be more than happy out there to help