AA+ Ping
Read the full pdf. It’s a disaster. On one hand, they say they aren’t taking a position on spending cuts versus tax increases. On the other hand, they mention new revenues three times in a favorable light.
Expect the dems and the liberal media to glom on to that and make political hay of it.
SLAP!
Very interesting. The owner of S&P is McGraw Hill.
Note this:
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Pre-Marketing: S&P for sale?
http://www.businessbrokerjournal.com/blog/pre-marketing-sp-for-sale
“Big breakup? Activists put pressure on S&P owner McGraw Hill “
Here is more about McGraw Hill:
“Compared with previous projections, our revised base case scenario now assumes that the 2001 and 2003 tax cuts, due to expire by the end of 2012, remain in place. We have changed our assumption on this because the majority of Republicans in Congress continue to resist any measure that would raise revenues, a position we believe Congress reinforced by passing the act. Key macroeconomic assumptions in the base case scenario include trend real GDP growth of 3% and consumer price inflation near 2% annually over the decade.”
IMF considers US debt as $203T, not $14T...look up Kotlikoff’s figures.
Weiss Ratings beat S&P to the punch:
http://ml-implode.com/viewnews/2011-07-15_WeissRatingsDowngradesUnitedStatesDebttoCMinus.html
Weiss Ratings Downgrades United States Debt to C-Minus
2011-07-15 — weissratings.com
Weiss Ratings, an independent rating agency of U.S. financial institutions and sovereign debts, has downgraded the debt of the United States government from C to C-minus.
The C-minus rating for the U.S. reflects a continued deterioration in the weaknesses cited in the Weiss Ratings release of April 28, 2011, including heavy debt burdens, shaky international stability, and poor economic health.
Weiss Ratings senior financial analyst Gavin Magor commented: “Our downgrade today is not contingent on the outcome of the debt ceiling debate in Washington. It is driven exclusively by the numbers, which indicate that, in addition to a decline in the long-standing weaknesses we noted three months ago, the U.S. has already lost the golden halo that helped guarantee liquidity and acceptance of its government securities in global markets.”
On the Weiss Ratings scale, which ranges from A (excellent) to E (very weak), a C-minus rating is the approximate equivalent of a triple-B-minus on the scales used by other credit rating agencies, or approximately one notch above speculative grade (junk).
About Weiss: By adhering to its independent business model, Weiss outperformed Standard and Poor’s, Moody’s, A.M. Best and Duff & Phelps (now Fitch) in warning of future life and health insurance company failures according to a 1994 study by the U.S. Government Accountability Office (GAO), while also outperforming its competitors in identifying the safest insurers, according to its follow-up study using the GAO’s research methodology.
http://weissratings.com/Login.aspx?a=r
U.S. Sovereign Debt Rating Close to “Junk”
by Weiss Ratings | July 14, 2011
“Weiss Ratings is very close to downgrading the sovereign debt rating of the United States one more notch to a ‘C –’, which will put it just one notch above junk,” Martin Weiss, President of Weiss Ratings told CNBC on Wednesday.
“In April, Weiss Ratings gave the U.S. sovereign debt rating a ‘C’. A ‘C’ is equivalent to approximately a triple-B on the S&P, Moody’s and Fitch scales. Its two notches above junk, Weiss told CNBC in May. Weiss added that while the rating was weak, the debt situation was not in a danger zone that should trigger panic.
In yesterday’s interview with CNBC, Weiss responded to Moody’s Rating Agency placing their U.S. triple-A rating on review for a downgrade in the coming weeks on mounting concern that legislators will fail to raise the debt limit in time to avert potentially drastic effects.
The U.S. government is deadlocked in negotiations to raise the $14.3 trillion debt ceiling by August 2 before a potential default. President Obama announced on Tuesday, that failure to increase the debt ceiling would jeopardize payments to Social Security and Veteran’s benefit recipients.
Weiss believes a downgrade by the large rating agencies is long overdue, noting that the top-notch standard assigned to the U.S. is unfair to investors and savers as they are not being compensated for the level of risk they are taking.
“The U.S. has a huge debt load compared to most other countries,” he said. “And, has a very unstable economy over the last 10 years compared to most other countries.” The U.S. ratio of debt-to-gross domestic product is currently over 90 percent.
“The only thing that’s really holding up the U.S. debt rating is a widespread international acceptance for U.S. Treasury securities and nice strong liquid market. But even that might be coming into question,” according to Weiss.
Weiss is hopeful that a last minute deal will fend off a potential crisis for U.S. and world markets. He pointed out that three years ago the legislature’s failure to pass a bailout package sent markets into a tailspin, and forced Congress to sign off on it.
He said, “We might see a similar scenario here in the debt ceiling debate, a failure at first and then a desperate deal in the thirteenth hour to rescue the situation at the last minute.”
Based on the government’s continued failure to agree on terms for raising the U.S. debt ceiling and the looming deadline, Weiss Ratings is reviewing its current ‘C’, rating signaling consumers that a ‘C-’ rating might be a fairer assessment under the circumstances.
Moody’s, S&P Caved In to Ratings Pressure From Goldman, UBS Over Mortgages
S&P can be bought off. Somebody wanted a higher return from Treasury bonds. Some Obama friends? The Chi-Coms? Who?
The market capitalization is off $1.4 trillion since this lunacy started. If the markets react to this news on Monday with a 1000-1500 point drop then $4.0 trillion of market cap..peoples 401k’s, pensions, market accounts will have disappeared. That's sure a way to get the country on the road to fiscal responsibility.
Anyone voting for any of these fools in the next election deserves what they get..
What did Obama & the obstructionist Senate say?
Harry Reid: "Over, Done, Dead"
White House: "Duck, Dodge and Dismantle."
Ping
So Standard and Poor’s is now in the business of legislating the USA? I think not.