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Understanding the credit mess our country is in can help you understand your own credit situation.  This article explains the credit mess the country is in right now.

How can our country repair its credit?

The Credit Crisis is Not Over

As we look back and this year comes to an end we find two plus years of failure. Even government admits to 1-1/2 years of negative growth – a sorry record after having poured trillions of dollars into the economy. The recent 3rd quarter results supposedly broke that record. If it did it was the result of government stimulus and Fed monetization. If you look back further you will find a stock market that rallied 54% just to reflect the highs of 1999. House prices have decline to 1990s levels as well. Both markets, which were bubbles, next year will fall again. Americans opened their markets to products of Communist China’s slave labor and China became the world’s biggest exporter. Via free trade, globalization, offshoring and outsourcing, transnational conglomerates have stolen America’s destiny and handed it to China. This is what corporatist fascism is all about.

The dollar will soon end its mini-rally and the USDX will test 71.18 in the first quarter as the euro tests $1.62. Interest rates will stay at zero for at least two years, and mega monetization will continue. As you have just seen the Treasury wants TARP funds for Treasury debt and the administration wants the TARP funds to further stimulate the economy. Either way it is very inflationary.

We are told the credit crisis is over and that recovery is underway. We do not believe that. It is projected that as many as 300 more companies will default on debt in 2011. A default rate of 12 to 14 percent. That is up from 1% in 2007 and a long-term average of 4.5%. These are not just small firms, but companies with more than $100 million in assets as well. That doesn’t sound like recovery to us. What is very significant is that the 300-figure is based on recovery. Only 116 companies defaulted between 2004 and 2007. One of the groups hit hard will be commercial real estate. The figures are already bad, but companies and lenders have been buying time by using two sets of books, marking to model and refinancing. All that doesn’t change the big picture and that is with a recovery the situation will be bad, without recovery it will be dreadful.    –more