One of the funniest things going on at the moment is that the credit agencies are somehow telling us that Greece is junk debt (which it probably is) and the United States is AAA (which it is not).

I think these rating agencies are a joke.

The rating agencies were shown to have all sorts of conflicts during the financial crisis. One reason they are slow to downgrade the United Stated is that they do all sorts of business in the U.S. collecting fees and such, so of course they will be slow to downgrade the United States.

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As a friend of mine would say, “They are a shame of a shame of a mockery.” I don’t know about you, but I don’t need Standard & Poor’s and Moody’s to tell me that Greece and Portugal are a mess.

We do know that America has a diverse, large economy and access to international markets and finance.

However, if you just look at the numbers, the U.S. is in just as bad of a situation, if not worse, than Greece.

Greece’s debt to GDP is 130 percent and its deficit as a percentage of debt is about 13 percent.

America’s debt to GDP will be about 100 percent (including states) at the end of the year and its deficit as a percentage of GDP is about 11 percent.

In addition, the expansion of government into healthcare and aging of the baby boomers are just going to add to government expenditures and there will be near $1 trillion dollar deficits as far as the eye can see.

What is happening in Greece will happen in American in 5 to 10 years.

Personally, I do not see how the U.S. is superior to Greece, Spain or Portugal.

In addition, if a company was borrowing money and wasting it, as the U.S. government does, they would certainly be rated as junk. At least Greece, Spain and Portugal can be kicked out of the euro zone.

Who is going to kick out the United States?

Finally, this again proves why you need to own some gold.

In euro terms, gold is breaking out to all time highs. Despite the U.S. dollar index rallying due to euro weakness, gold is going up as investors fear government debts everywhere.

As I write, Spain has just been downgraded. The dollar strengthened but gold rallied on this news.

Gold can’t be defaulted on; it is not someone else’s liability.

In times of crisis, you want to own gold.

About the Author: David Skarica
David Skarica is a member of the Moneynews Financial Brain Trust. Click Here to read more of his articles. He also writes the Gold Stock Adviser. Discover more by Clicking Here Now.