Before we talk about the impact of the debt deal on the economy or even whether this deal can work as a practical matter, let's get down to brass tacks. What does the deal mean for your wallet?
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On the face of it, the short term impact is nada. Nothing. After all, the threat of default has pretty much lifted.
But that doesn't mean we are out of the woods when it comes to a debt downgrade by one of the big rating agencies like Standard & Poor's or Moody's.
In fact, chances are pretty good that at least one of those agencies will decide to cut the rating on our government bonds to double A from triple A. And, that will most likely mean higher interest rates for everyone.
Whether you're buying a house or a car or a college education, rates will likely tick higher as much as a percentage point, say my sources. But it could be more.
That's bad news for borrowers. Higher interest costs means the cost of everything goes up. You want to start a new business -- your costs just got higher. Paying down credit card debt? Higher costs.
If you are a saver though -- breathe a sigh of relief. You'll get higher returns on certificates of deposit and money market funds.
Speaking of money market funds, all the durm and strang you've heard about money market funds not being safe because of this crisis, not true.
According to Crane Data, money market fund managers won't have to dump treasuries if those securities are downgraded. In other words, the sky is not falling.
With money market funds returning three-tenths of a percent on average -- the bigger threat to your money isn't the federal debt but inflation. Sources tell me we may not even have a major stock market selloff if S&P makes good on its promises.
I'd like to be that upbeat, but I'm not. I'd say now is the time to have a wish list of stocks or mutual funds you'd like to buy on the cheap, if there is a selloff.
Keep in mind though my crystal ball is cloudy. Forecasting the future on these topics isn't easy -- we've never been here before.
It's fresh territory. One of my sources points out to me that when Japan lost its triple A credit rating, interest rates fell, so go figure.
All I am giving you is my best educated guess -- and the guesses of my sources. Now, when it comes to analyzing the plan as a solution to our debt problems -- well most folks say we have to get behind it because it's the best we can do.
Ridiculous! We could have done better.
In fact, even with this deal our debt is still on track to grow by more than $7.5 trillion over the next ten years.
So, the trajectory is the same -- more debt, more of a burden for your kids and their kids. One part of the deal raising big questions -- and for good reason -- a special committee that would have to make the tough program cuts that congress and the president are just too wussy to deal with.
On Capitol Hill, they are calling it a super congress -- a 12-member panel that would devise a list of cuts that could impact major entitlement programs.
The old-fashioned congress, the one described in the Constitution, could only vote "yea" or "nay."
The precedents aren't encouraging. President Obama ignored the recommendations of the Simpson-Bowles Commission, shelving their recommendations.
The Domenici-Rivlin Task Force? The same thing happeneda big zip.
So if you're looking for the so-called commission or super congress to magically get it all right -- keep on waiting.
As always, it's up to you and me and every other American to provide for our futures. What did Ronald Reagan say are the nine most terrifying words in the English language?
"I'm from the government and I'm here to help."