S&P downgrades US credit rating from AAA

[aGameOfThrones]

S&P downgrades US credit rating from AAA

By MARTIN CRUTSINGER
AP Economics Writer
WASHINGTON (AP) - Credit rating agency Standard & Poor's says it has downgraded the United States' credit rating for the first time in the history of the ratings.

The credit rating agency says that it is cutting the country's top AAA rating by one notch to AA-plus. The credit agency said late Friday that it is making the move because the deficit reduction plan passed by Congress on Tuesday did not go far enough to stabilize the country's debt situation.

A source familiar with the discussions said that the Obama administration believes S&P's analysis contained "deep and fundamental flaws."


(Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)

http://mynorthwest.com/?nid=189&sid=465023

[smartguy911]

I have no clue is this is a good thing or bad thing? Maybe now folks in congress might pay attention and work hard to bring it back to AAA??

[HOLLYWOOD]

GOOD for RON and RAND and their warnings, policies, bills, and voting...

It's on us now...

[cindy25]

welcome to the 3rd world

[Vessol]

The sooner this Ponzi scheme dies, the better.

[freejack]

Props to S&P for having the balls to say it.

[moderate libertarian]

This debt downgrade will cost US $100 Billion per year more to borrow money or in other words about the cost of a war much smaller than Iraq war.

http://www.washingtonpost.com/wp-dyn/content/article/2010/09/03/AR2010090302200.html


JPMorgan Chase & Co. estimated that a downgrade would raise the nation’s borrowing costs by $100 billion a year.

http://www.bloomberg.com/news/2011-08-06/u-s-credit-rating-cut-by-s-p-for-first-time-on-deficit-reduction-accord.html


On a different note, a guest on CNBC stated short while ago that Obama administration was being called a "gangster government" by some people allegedly for making threats against S&P like cancellation of its license if it downgraded US debt.

[roho76]

A source familiar with the discussions said that the Obama administration believes S&P's analysis contained "deep and fundamental flaws."

Oh. OK. If he says so. I mean S&P has only been doing this for a 100+ years and they're the idiots not you Mr. President. All those years as a community supervisor must have taught you a lot about international credit ratings.

Thus guy is so full of himself that he shits little gold statues of himself.

[guitarlifter]

I'm shocked. Not.

[sailingaway]

Oh. OK. If he says so. I mean S&P has only been doing this for a 100+ years and they're the idiots not you Mr. President. All those years as a community supervisor must have taught you a lot about international credit ratings.

Thus guy is so full of himself that he shits little gold statues of himself.

It shouldn't have been AAA regardless, they are tools, and are pushing for a specific result they want. Regardless, what did Congress expect? They are such wusses.

[sorianofan]

I thought raising the debt ceiling was supposed to prevent this.

[HOLLYWOOD]

Props to S&P for having the balls to say it.S & P AND Moody's is also under investigation in Italy... their offices were raided...
Italian authorities raid Milan offices of S&P, Moody’s

The raid is seen as the eurozone government’s way of getting back at ratings agencies, which recently downgraded the credit rating of Greece, Portugal and Ireland.

http://www.allheadlinenews.com/articles/90056267?Italian%20authorities%20raid%20Milan%20of fices%20of%20S%26P%2C%20Moody%26%23146%3Bs

I hope the campaign is calling all the MSM and scheduling interviews, Morning Joe, FOX, etc. RON/RAND and their sound money, what they have advocated,warnings, etc... never let a crisis go to waste, eh?

Expose the Inept Coward Commission too.

[Paul Revered]

This debt downgrade will cost US $100 Billion per year more to borrow money or in other words about the cost of a war much smaller than Iraq war.

http://www.washingtonpost.com/wp-dyn/content/article/2010/09/03/AR2010090302200.html


JPMorgan Chase & Co. estimated that a downgrade would raise the nation’s borrowing costs by $100 billion a year.

Where are you getting this information? That link is to a blame Bush article from 2010.

[trey4sports]

its about god-damn time.

[freejack]

Damn S&P is laying the smackdown hard!

http://www.cbsnews.com/stories/2011/08/05/national/main20088952.shtml?tag=stack

"The outlook on the long-term rating is negative. We could lower the long-term rating to 'AA' within the next two years if we see that less reduction in spending than agreed to, higher interest rates, or new fiscal pressures during the period result in a higher general government debt trajectory than we currently assume in our base case."

[bkreigh]

I thought raising the debt ceiling was supposed to prevent this.

That was the first thing i thought of as well when i saw the news on CNN.com

[TheBlackPeterSchiff]

If S&P had any credibility this would actually mean something.

[DamianTV]

The sooner this Ponzi scheme dies, the better.

It is a Chance, not a Guarantee.

It may or may not work, but odds are they will try to introduce some form of replacement Fiat Currency, like the Amero, or possibly some form of World Fiat Currency, but I believe this is our Best Chance at replacing our Fiat Currency with an Honest Money System.

[cindy25]

the direct cost will be at least 1% of debt ($175 billion a year), plus the effect of state and local govt. Interest rates could rise 5-10% based on inflation also.

[moderate libertarian]

Where are you getting this information? That link is to a blame Bush article from 2010.

Oops, I have added the Bloomberg link to the post that I missed earlier. First link was for foreign spending costs that Obama compounded even if were started by Bush.
It wasn't meant to be a partisan point but botrh are to blame if you're looking from Obama-Bush angle.

[angelatc]

Oh. OK. If he says so. I mean S&P has only been doing this for a 100+ years and they're the idiots not you Mr. President. All those years as a community supervisor must have taught you a lot about international credit ratings.

Thus guy is so full of himself that he shits little gold statues of himself.

Yes, but it isn't like S&P has a spotless record in such things either. This is popcorn-worthy.

[Brooklyn Red Leg]

Well this was predictable.

:sigh:

We know what Cassandra felt like....

[wannaberocker]

Its well deserved really. I dont think its that bad of a thing in the long term. Short term there might be some pain but long term it will mean that congress cant ignore our financial problems.

[wannaberocker]

Yes, but it isn't like S&P has a spotless record in such things either. This is popcorn-worthy.

Of course S&P dosnt have a spotless record, no one does. But thats still better than Obama's record of "nothing". Obama is so ignorant of basic finance and economics that he prob calls inflation, greed.

[YumYum]

Interest rates will go up; what will this do to PMs?

[HOLLYWOOD]

Nouriel Roubini, chairman of Roubini Global Economics LLC, Joshua Rosner, managing director of Graham Fisher & Co. and Jim Bianco, president of Bianco Research LLC talk with Bloomberg's Michael McKee about Standard & Poor's downgrade of the U.S. credit rating to AA+ from AAA. Bloomberg contributor Christina Romer <=== :rolleyes: also speaks with Adam Johnson. (Source: Bloomberg)

VIDEO: http://www.bloomberg.com/video/73606936/

[libertyjam]

This debt downgrade will cost US $100 Billion per year more to borrow money or in other words about the cost of a war much smaller than Iraq war.

http://www.washingtonpost.com/wp-dyn/content/article/2010/09/03/AR2010090302200.html

JPMorgan Chase & Co. estimated that a downgrade would raise the nation’s borrowing costs by $100 billion a year.

http://www.bloomberg.com/news/2011-08-06/u-s-credit-rating-cut-by-s-p-for-first-time-on-deficit-reduction-accord.html


On a different note, a guest on CNBC stated short while ago that Obama administration was being called a "gangster government" by some people allegedly for making threats against S&P like cancellation of its license if it downgraded US debt.

This president is so toast. What a stupid ass! The majority of Americans, no matter their politics can see through this type of sheer bullcrap, and if he is actually saying things like a Chicago thug, watch his remaining support disappear like scurrying cockroaches. The only ones left will be those so stupid, so enamored of thug power, they will truly be the chi-town mafia.

[moderate libertarian]

The guy is a scam artist like most politicians who sit in Washington lately and he successfully fooled the ignorant masses. In the end people are responsible for their igonorance and choices.

[Vessol]

Yes, but it isn't like S&P has a spotless record in such things either. This is popcorn-worthy.

This.

http://cdn.wg.uproxx.com/wp-content/uploads/2011/06/joffrey-clap.gif

[BUSHLIED]

S & P went so far as to say that Medicare needs to be cut if the economy is to be stabilized. If we think the debt limit fight was bad, just wait unless they try to make entitlement cuts...

[Sola_Fide]

This is great news folks!

[wannaberocker]

S & P went so far as to say that Medicare needs to be cut if the economy is to be stabilized. If we think the debt limit fight was bad, just wait unless they try to make entitlement cuts...

if they try to do that i predict riots.

[Bergie Bergeron]

S&P downgrade report would cite "political confusion" and GOP refusal to accept tax hikes http://abcn.ws/nOlIbr

[YumYum]

if they try to do that i predict riots.

Yep, elderly people will be beating people with their walkers!

[wannaberocker]

Yep, elderly people we be beating people with their walkers! They dont use walkers anymore, they use those mopad things that work on battries. THey would use those to try and run people over with.

[civusamericanus]

the direct cost will be at least 1% of debt ($175 billion a year), plus the effect of state and local govt. Interest rates could rise 5-10% based on inflation also.
It will cost everyone more money to borrow. But our governments will continue to borrow at the same PACE at a higher rate. As the rates increase lending to buy a new home or car will slow (kill) both of those markets. The banks will take more of borrowers already depreciated money, and interest rates will steadily rise similar to 1979-1981, but this time we will likely see 18-20% before Obama leaves office.

If Obama was dealt a bad hand when he took the presidency, whomever wins the White House in 2012, will be sweeping up the rubble. All of this could have been averted if Ron Paul had won the presidency in 2008, his veto power on spending, would have kept the wolves at bay. We would have been on the road to true economic recovery by this time. It doesn't take a genius to figure out how to "Restore America", spending less then you bring in, and paying down the debt, is just common sense.

In an interview from 1983, Ron Paul warned that if we continue at the current rate of spending and borrowing, the United States would go bankrupt.

http://www.theglobalfczone.com/images/Debt-US-1967-2011.png

[lx43]

RP campaign should have issued an immediate press release to capitalize on this downgrade like the tax enforcer and flip flopper.

[Cowlesy]

This could cause a lot of problems, but I doubt it. From what I knew, it was $4T or downgrade during the compromise on Tuesday. I doubt treasury yields will move at all higher. That is a pure guess.

The problem that could happen, is that a lot of pension funds/public plans may have it in their by-laws that they can not invest on the short-term in anything less than Triple-A paper. Now, if those by-laws aren't just tied to S&P (they may also say a sterling ratings by Moody's or Fitch), it might be fine. Otherwise, a lot of these funds will need to amend their by-laws or operating agreements to be allowed to invest in the short-term in AA paper by S&P.

[axiomata]

This could cause a lot of problems, but I doubt it. From what I knew, it was $4T or downgrade during the compromise on Tuesday. I doubt treasury yields will move at all higher. That is a pure guess.

The problem that could happen, is that a lot of pension funds/public plans may have it in their by-laws that they can not invest on the short-term in anything less than Triple-A paper. Now, if those by-laws aren't just tied to S&P (they may also say a sterling ratings by Moody's or Fitch), it might be fine. Otherwise, a lot of these funds will need to amend their by-laws or operating agreements to be allowed to invest in the short-term in AA paper by S&P.

Would such funds have time to amend their rules or are will they be forced to sell their US Gov bonds Monday morning?

[sailingaway]

This could cause a lot of problems, but I doubt it. From what I knew, it was $4T or downgrade during the compromise on Tuesday. I doubt treasury yields will move at all higher. That is a pure guess.

The problem that could happen, is that a lot of pension funds/public plans may have it in their by-laws that they can not invest on the short-term in anything less than Triple-A paper. Now, if those by-laws aren't just tied to S&P (they may also say a sterling ratings by Moody's or Fitch), it might be fine. Otherwise, a lot of these funds will need to amend their by-laws or operating agreements to be allowed to invest in the short-term in AA paper by S&P.

Rand said last week on some show that the pension funds etc had gotten a change in their rules that it had to be a AAA rating 'or treasury bills'.

[lx43]

Would such funds have time to amend their rules or are will they be forced to sell their US Gov bonds Monday morning?

Some funds have already started to amend the rules to say AAA and Govt debt.

[RonPaul101.com]

I have no clue is this is a good thing or bad thing? Maybe now folks in congress might pay attention and work hard to bring it back to AAA??

I would say goo thing. Not good that the US is less credit worthy, but good that the rating is now more accurate and hopefully we begin to fix the root of the problems.

[thehungarian]

Good. Shame them and maybe some will change.

[Teaser Rate]

Why the fuck is anyone happy about this? It's horrible news.

I hope the Feds conduct a few no-knock raids on the houses of S&P executives and shoot their dogs.

[Teaser Rate]

I have no clue is this is a good thing or bad thing? Maybe now folks in congress might pay attention and work hard to bring it back to AAA??

Being happy about this is a bit like being happy that our soldiers got killed in battle because it might help end the war sooner.

[DamianTV]

...

I hope the Feds conduct a few no-knock raids on the houses of S&P executives and shoot their dogs.

Gadzooks! I hate to say it, but that sounds like a damn good idea! Get cops to shoot the dogs (well, at least threaten to, I dont want to see any animals actually suffer or die) of the Politicians, Corrupt Bankers, and every other asshole who thinks that this dog shooting spree is a good thing!

[aravoth]

Being happy about this is a bit like being happy that our soldiers got killed in battle because it might help end the war sooner.

maybe because they understand that if the government can't afford to send troops overseas anymore none of them will die in combat?

Think first, emotional stress later..

[libertybrewcity]

A few years overdue..geezus

[TRIGRHAPPY]

Why the fuck is anyone happy about this? It's horrible news.

I hope the Feds conduct a few no-knock raids on the houses of S&P executives and shoot their dogs.

http://www.guardian.co.uk/world/2011/aug/04/police-raid-milan-moodys-standard-poors

[civusamericanus]

maybe because they understand that if the government can't afford to send troops overseas anymore none of them will die in combat?

Think first, emotional stress later..
I wouldn't get my hopes up, they'll just pay a higher interest rate to kill our soldiers. They may even consider a bigger war, since they live under the dillusion, we ended the depression with WW2.

Don't forget what's in between Iraq -- and -- Afghanistan. Fill in the blanks, and don't forget Iraq and Afghanistan were never the targets, but what lies between them. They simply needed the best geographical position.

http://www.rupinews.com/wp-content/uploads/2008/07/map_possible_war.jpg

[Revolution0918]

this is what happens when you fuck a stranger in the ass

[DamianTV]

this is what happens when you fuck a stranger in the ass

There's always time for Lubricant!


http://www.youtube.com/watch?v=4wvbnR_cT0A

[BarryDonegan]

We knew this would happen.

[DamianTV]

The outcome of the Debt Ceiling had no bearing. They downgraded the Governments (not ours, but it affects us just the same) Credit Rating for Irresponsible Spending.

[GunnyFreedom]

The outcome of the Debt Ceiling had no bearing. They downgraded the Governments (not ours, but it affects us just the same) Credit Rating for Irresponsible Spending.

They did warn us, publicly and several times, that the downgrade would be for spending, not for failing to raise the debt ceiling. The establishment politicos just ignored them/straight out lied to us.

[DamianTV]

Welcome to the United States of Zimbabwe. Straight from A to Z.

[osan]

http://mynorthwest.com/?nid=189&sid=465023

The same S&P who rated as AAA investments all the CDSs and CDOs that turned out to be complete shit and for whom the taxpayers footed the bill to a select few corporate elite such as AIG and Goldman?

God help us for our willful ignorance because the likes of S&P should be hanging by their balls rather than be occupying any position of de-facto authority to rate anything.

Yet another amusing view into a nation's spiraling romp down into the doomhole.

[osan]

The sooner this Ponzi scheme dies, the better.

But for the sticky wicket of how it dies. Different modes present wildly differing outcomes for the likes of you and myself. Indeed the beast must die, but let us not commit suicide in the process.

[osan]

Props to S&P for having the balls to say it.

Props? Are you joking here? They should have been put out of business.

Where were they in the decade leading up to 2008? They were fanning the flames that now threaten to consume us. And now they make this lame attempt at playing the boyscout? Come one man, pop your head out of your anus and take a look around you, for heaven's sake.

Props, my ass. Bullets and lots of stiff rope.

[osan]

If S&P had any credibility this would actually mean something.

Finally someone calls it straight up.

[Bern]

Interest rates will go up; what will this do to PMs?

Right now there is capital flight out of Europe to treasuries. Started when everything went south in Italy just before our stock market tumbled. Capital flight from Europe will likely go to Switzerland and PMs now (at least - a good portion will). Treasury Dept. is going to be attempting to issue new bonds in a toxic environment now. Expect the Fed to initiate QE3 to save the day. This is all very bullish for PMs, so expect more CME margin hikes to try and quell the tides.

[Bern]

Posted July 15th:
Someone dropped a bomb on the bond market Thursday – a $1 billion Armageddon trade betting the United States will lose its AAA credit rating.In one moment, an invisible trader placed a single trade that moved the most liquid debt market in the world.

The massive trade wasn’t placed in bonds themselves; it was placed in the futures market.

The trade was for block trades of 5,370 10-year Treasury futures executed at 124-03 and 3,100 Treasury bond futures executed at 125-01.

The value of the trade was about $850 million dollars. In simple terms, if that was a direct bond buy, no one would be talking about it.

However, with the use of futures, you have to have margin capacity behind the trade. That means with a single push of a button someone was willing to commit more than $1 billion of real capital to this trade with expectations of a 10-to-1 return ratio.

You only do this if you see an edge.

This means someone is confident that the United States is either going to default or is going to lose its AAA rating. That someone is willing to bet the proverbial farm that U.S. interest rates will be going up.
...

http://etfdailynews.com/2011/07/25/investors-the-1-billion-armageddon-trade-placed-against-the-united-states/

http://assets.portfolio.com/views/columns/howard-beale-network-large.jpg

[osan]

This president is so toast.

I'd stop counting those chickens until the eggs have hatched. His political demise is far from foregone.


The majority of Americans, no matter their politics can see through this type of sheer bullcrap,

Um... no, the cannot. They are not even close to it, on the whole.



and if he is actually saying things like a Chicago thug, watch his remaining support disappear like scurrying cockroaches.

If anything, this will serve to save him. People are far and away more willfully stupid than you appear to appreciate. You should endeavor to correct this dangerously flawed view of the world.


The only ones left will be those so stupid, so enamored of thug power,...

Possibly still a majority bloc. HELLO.

[freejack]

Props? Are you joking here? They should have been put out of business.

Where were they in the decade leading up to 2008? They were fanning the flames that now threaten to consume us. And now they make this lame attempt at playing the boyscout? Come one man, pop your head out of your anus and take a look around you, for heaven's sake.

Props, my ass. Bullets and lots of stiff rope.

So you'd crucify them for lying and then tie them up and shoot them for telling the truth? I don't understand your logic. Would you rather they continue to mislead us and play nice with the Whitehouse and their peers? In one press release, they have been able to proclaim to the world what we've been trying hard to convey for years. This is the wakeup call for the masses. It's paving the way for our message to get through.

[wannaberocker]

So you'd crucify them for lying and then tie them up and shoot them for telling the truth? I don't understand your logic. Would you rather they continue to mislead us and play nice with the Whitehouse and their peers? In one press release, they have been able to proclaim to the world what we've been trying to hard to convey for years. This is the wakeup call for the masses. It's paving the way for our message to get through.

Exactly, I dont understand the people who in one post claim that we dont deserve a AAA rating. But in the other post they knock S&P for actually downgrading us. As Dr Paul said this morning while talking on Fox that "im surprised it took us this long to get downgraded". The truth is that we all know that we dont deserve a AAA rating. Now even S&P agrees, so whats the beef with S&P all about? i dont get it.

[kahless]

so whats the beef with S&P all about? i dont get it.

The Progressive media and Democrat party talking points is to blame the failure for their policies on others which includes bashing S&P for doing their job finally. People are just echoing the false anger they hear from these talking heads.

[HOLLYWOOD]

The Progressive media and Democrat party talking points is to blame the failure for their policies on others which includes bashing S&P for doing their job finally. People are just echoing the false anger they hear from these talking heads. Liberal Radio and TV have started their blame campaign, Republicans, Tea Party and now, it's A TRILLION accounting error by S & P on the longterm debt. Yes from the White House with the crony staff of economic circus twirlers who have failed repeatedly, most who have left the USS Titanic like scurrying rats, are challenging S & P. :rolleyes:

Oh these political point/counterpoint... these Thesis/Antithesis = Synthesis nonsense. It never stops in the power struggles of the False Dichotomy of the Duopoly game.

[georgiaboy]

Exactly, I dont understand the people who in one post claim that we dont deserve a AAA rating. But in the other post they knock S&P for actually downgrading us. As Dr Paul said this morning while talking on Fox that "im surprised it took us this long to get downgraded". The truth is that we all know that we dont deserve a AAA rating. Now even S&P agrees, so whats the beef with S&P all about? i dont get it.

+rep. I applaud S&P, only hope they take it down another notch or more as the fedgov starts up QE∞ and the SuperCongress creates ridiculous proposals that still drive the US into the financial abyss.

[Napoleon's Shadow]

http://www.youtube.com/watch?v=BbOO3w43AJc

[Bern]

Yum Yum:
As a couple of other turdites have pointed out PM's on the India Commodity Exchange are up on the US downgrade news. Interestingly enough they are open on saturdays. I think we can gauge that traders in India are informed and responded accordingly, there was a gap up at the open in the price of silver and then it continued higher then flattened out. See chart. Granted comex is a criminal operation, there should be follow through when the markets open. I am loading up on the opportunity here as our phyz G and S prices are fixed over the weekend. Obviously there is risk involved for the short term in that equities will certainly be down monday and it could drag silver down with it, but I doubt gold. So I could be paying a bit more(but I doubt it) if silver does head to the 37 level. At this point I am focusing on Gold as I see this as a more sure bet...and I am already loaded pretty heavy with the white metal. Do your own analysis and tell me what you think

http://www.tfmetalsreport.com/sites/default/files/users/u2834/homepage.png

http://www.tfmetalsreport.com/blog/1928/three-weekly-charts?page=3

[affa]

Its well deserved really. I dont think its that bad of a thing in the long term. Short term there might be some pain but long term it will mean that congress cant ignore our financial problems.

You obviously haven't met our congress.

[Bern]

http://www.youtube.com/watch?v=SgNLTb58K_Y

[Imaginos]

AA-plus?
That's BS.
I would give 'Z'.

[wgadget]

Here comes QE3:

http://www.moneynews.com/StreetTalk/China-US-fed-easing/2011/08/06/id/406325

[YumYum]

Yum Yum:

As a couple of other turdites have pointed out PM's on the India Commodity Exchange are up on the US downgrade news. Interestingly enough they are open on saturdays. I think we can gauge that traders in India are informed and responded accordingly, there was a gap up at the open in the price of silver and then it continued higher then flattened out. See chart. Granted comex is a criminal operation, there should be follow through when the markets open. I am loading up on the opportunity here as our phyz G and S prices are fixed over the weekend. Obviously there is risk involved for the short term in that equities will certainly be down monday and it could drag silver down with it, but I doubt gold. So I could be paying a bit more(but I doubt it) if silver does head to the 37 level. At this point I am focusing on Gold as I see this as a more sure bet...and I am already loaded pretty heavy with the white metal. Do your own analysis and tell me what you think

http://www.tfmetalsreport.com/blog/1928/three-weekly-charts?page=3

I really don't know. But I will say that it appears what is holding back silver is its demand more as an industrial metal than as money. One reason I say this is that platinum is also an industrial metal in limited supply, and yet it, like silver, is holding back. Gold is closing in on platinum, and if gold passes platinum, I would think it wise to dump silver and stick with gold.

http://www.goldline.com/gold-prices-charts