This week Fareed Zakaria sat down with the new head of the International Monetary Fund, Christine Lagarde. They talked about the U.S. deficit and the debt ceiling debate. Here is Christine Lagarde agreeing with Fareed Zakaria that the damage has already been done.
Fareed Zakaria: Do you think that the dangers that people speak of could happen anyway - that is, watching this process, markets might lose that kind of unshakable confidence they had that U.S. Treasury bills were the bedrock of the international financial system? That they were the cheapest debt, that it was the place where people went as a flight to safety, has all that already been jeopardized? Or is there a danger that that has been undermined?
Christine Lagarde: You're quite right, Fareed, in saying that there was a positive bias towards the United States of America, towards Treasury bills. That was the case historically. And the current crisis is probably chipping into that very positive bias.
That very strong confidence that generally led to flight equality and investment in Treasury bonds is slightly eroded at the moment. I mean, it was unheard of, only six months, to imagine that the United States could be under negative watch by the rating agencies.
To watch the full interview with Christine Lagarde, tune in Sunday at 10AM and 1PM ET.
one thing I do not understand: if John Boehner had to lose 100 or so votes , aren't there still 335 votes left in the house; the Boehner/Obama 3-1 plan would have easily passed the Senate and would not one expect that 150 or so Democrats would be on board in the House along with perhaps 100 republicans so it 'would' have passed the house as well??
Even if the debt ceiling is raised and Congress reaches an agreement, the damage to this is already done, thanks to all these right-wing politicians in Washington. Still, it never occurs to any of these stupid fools to cut the excessive and unnecessry military spending and stopping these useless wars which are breaking the national treasury. Enough is enough!!!
A balanced budget will be – cut spendings wisely and tax the rich accordingly. America will still be a great place for them to live in and they wouldn't move abroad just to dodge tax.
Christine Lagarde was a breath of fresh air. What an inspirational model. Her low key approach and incredible intelligence coupled with her ability to see the entire picture was so very positive. Matching Christine Lagarde with Fareed in an interview is a perfect marriage of great minds and great presentation.
Madame Lagarde is right, harm is already done. America lost a lot of respect in the past 10 years because of Bush ignorance and wars. Now thanks to Obama weakness, we lost the remaining respect. Cant America get a strong President?
Fareed: You stated that we have no one to blame but ourselves for this mess. I beg to differ. "WE" have Congress and the executive branch to blame. They are ALL (D&R) derelict in their duties at this point and they should all resign.
At the conclusion of his interview with Ms Lagarde, Mr Zakaria commented on her choice of clothing for the event...I hope in the future, Mr Zakaria extends the same courtesy to all of his male guests...
Every democratic nation selects its government at its own will, and so do Americans. If Americans do not like what they came up with, tough luck: evidently they do not deserve anything better.
Super Congress, Politburo, what's the difference. The Middle Class is doomed and the Plutocracy is now officially here and sanctioned thru legislative connivance. As a border Canadian, I am holding my Real Estate, the CDN market is about to go thru the roof as prescient Americans get the heck out of Dodge.
A Super Congress would be less accountable than the system that exists today, and would find it easier to strip the public of popular benefits. Negotiators are currently considering cutting the mortgage deduction and tax credits for retirement savings, for instance, extremely popular policies that would be difficult to slice up using the traditional legislative process.
House Speaker John Boehner (R-Ohio) has made a Super Congress a central part of his last-minute proposal,
Got that? "Anti-tax" Boehner wants a Super Congress, which could eliminate popular tax credits and deductions. With "anti-tax" patriots like Boehner, who needs Democrats?
Bottom line: What the entire D.C. crowd is really looking for is a way to screw the elderly and also raise taxes, while not get caught doing it.
The Obama/Boehner plan, which I believe was the 1st submitted, was blocked by Boehner himself at the 11th hour! His teabag pals didn't feel it went far enough with the necessity programs cut. He tried to rewrite it, but Obama didn't go along with that so the thing was shelved! So far I think they are 3-3, the new plan will be #4! We have a strong President, but a weak Republican party, who are bullied from within by the teabags, & from outside by lobbyist for very wealthy companies. This makes them bullyish toward working class Americans. It seems to all come down to $$$ for the GOP & they have forgotten the people the work for, us! I'm not so naive I think the Democrats aren't swayed by $$$ too, but somehow they are able to curb that bent & do their jobs 1st!!
Fareed, Yes the current budget was approved, by a congress held by democrats and run by democrats with a democratic president. The PEOPLE have elected new congress people to STOP the runaway spending. Regardless the cause of a problem we can't simply wave our hands and say oh well, we made that decision last year so we must overspend. One of my MBA professors, Roger Conover, used to say in Managerial Finance, "if you run out of cash, you lose." If we cannot continue to borrow beyond our means of paying the principal and interest we will run out of cash. If we can't understand that I would lose confidence in our ability as a people to overcome this situation and this economy. However, the trend towards understanding the fundamentals of finance as demonstrated by the current conversation should bolster the confidence in the future of our great nation and people. i enjoy your writing and your show, but if you could step out of your typically muted ideology and see things for what they are and not add to the hype i would appreciate it. Thank you.
Unfortunately CNN "Breaking News" preempted your 10 am broadcast here in California. The Breaking News is a joke because they were just repeating what has been speculated on for the entire week. I really missed your program because it is the only intelligent one on the air aside from the PBS offerings. And your program goes into more depth than the others. So please tell CNN biggies that they do us no favors by rehashing the news, even though i like Wolf Blitzer!
Mr. Zakaria's clothing comment to Christine Lagarde on his July 31 broadcast was outrageous. The remark was rude, demeaning, discriminatory, and unprofessional. Mr. Zakaria owes an apology to Ms. Lagarde, France, the IMF, and every woman on this planet.
The Global Public Square is where you can make sense of the world every day with insights and explanations from CNN's Fareed Zakaria, leading journalists at CNN, and other international thinkers. Join GPS editor Jason Miks and get informed about global issues, exposed to unique stories, and engaged with diverse and original perspectives.
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Check out all of Fareed's Washington Post columns here:
Obama as a foreign policy president?
Why Snowden should stand trial in U.S.
Hillary Clinton's truly hard choice
China's trapped transition
Obama should rethink Syria strategy
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