Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
Yeah these rating agencies are great, they were right on top of that whole housing crisis...
oh yeah they werent they totally missed it or were in collussion.
waht a bunch of clowns, who cares what they say.
also, whats the point of having a debt limit if it gets raised every year? im going to make a household budget and when my spending runs amock and I blow my whole paycheck on coke and hookers im going to raise my budget so next month i have more money.
Yeah these rating agencies are great, they were right on top of that whole housing crisis...
i hear a lot of people saying this and i definitely agree they f'ed up big time with the mortgage backed securities. however, i think that they are being more careful with the ratings of nations' debt because of how bad they messed up before. they are downgrading the national debt because its potentially risky, something they should have done with the mortgage backed securities. now you have jerks in government's of countries with debt issues trying to attack the ratings agencies' screw ups to deflect from the real issues with their debt.
Rating agencies are great at telling you someone is bankrupt after the fact. Just look back on Lehman, WorldCom, Bear Sterns, and Enron. The rating agencies did a great job of downgrading all of them after the stocks had already crashed.
Kind of makes you wonder how bad the finances of the Federal Government really is.
moody's is still on the warpath (from wall street cheatsheet)
Ratings agency Moody’s (NYSE:MCO), which in recent weeks has warned that it will downgrade its AAA on the debt of the United States Federal Government, has now issued a new slate of threats to individual states. Today the “investor’s service” released a statement announcing that it has placed five states, Maryland, New Mexico, South Carolina, Tennessee, and the Commonwealth of Virginia, on review for possible downgrade from their current AAA bond ratings. The agency cites the states’ high federal employment and medicaid exposure as reasons for the review, which will affect a total $24 billion of rated debt.
Because of the ripple effect. A downgrade in US debt ratings will impact states like MD that have such a large federal presence. As it is MD has a very good bond rating and as a result gets a low interest rates on bond issues. This also ripples down to some of the Counties and municipalities.
you think raising the debt limit will save us because we wont have any problem moving forward adding $1.5-2 trillion annually to our debt. tying the ratings downgrade to the debt ceiling issue isnt appropriate, we already should be downgraded because we cant sustain the amount of debt we are going to have.
The US has been spoiled for too long.
Any other nation with a huge trade and current account deficit, a {fed/state/mun} debt level of 120% which is above Italy's, high unemployment, slow growth economy, stagnant wages, very high rates of personal indebtedness, and massive deficits as far as the eye can see would have ALREADY had their credit rating downgraded.
The US situation is worse than many other highly indebted nation like Japan where 88% of the money the government owes is to it's own citizens whereas in the US most is owed to it's political advasaries China and Saudi Arabia.
If it wasn't for US political pressure the US would have a far lower credit rating than it's present best one in the world if it was based solely on it's economic fundamentals, outlook, and credit worthiness.
That would be because every financial professional in every financial market in the entire world uses these ratings agencies as a metric for the creditworthiness of any entity to which they apply. That means that when the ratings agencies downgrade the US, investors all over the world will pretty much instantly demand higher interest rates to hold riskier US debt securities - and your wallet (and your childrens' wallets) will most certainly come to know the difference due to the many untold billions upon billions more in future interest expenses that we as a nation will have to repay. In addition to that, as the US has been the world's most stable reserve currency up until now, a downgrade is likely to reflect itself in a materially detrimental effect on the value of the US dollar and the valuation of financial markets all over the world. Does all that sound to you like something that should be taken seriously?
great point ambient. this would definitely affect the US dollar since what its based on is peoples faith in the US economy and ability pay back its debt. this would also certainly raise interest rates. so it is very significant
The ratings agencies are telling us that just raising the debt limit will NOT prevent a downgrade. What they are saying is show us a real plan or we will downgrade.
Cut, cap and balance is NOT a real plan. Nowhere near enough to make a dent, and based on phoney assumptions. Meanwhile, looks like we can't even pass CCB. Folks, we are toast. Prepare accordinly. I'm trying to move my family out of FL because this is just about the last place you want to be when the you know what hits the you know what. (and it will, be it in August or a few years from now)
Now, whether these rating agencies will act is another story. We've heard their "threats" before. I think we would have to see a big market crash before they follow through on anything.
Should be an interesting week to come, for sure. (although this all makes me sick, as I'm sure it does for most of us who have a clue). Voters want a balanced budget, but when a proposal comes to light that even hints at raising the SS age or something, the politicians' phone lines light up from irate voters. Folks, a balanced budget would GUT everything that we currently have to the tune of about a 40-42% cut. Defense, SS, Medicare, food stamps, everything would have to be cut drastically if we wanted to balance our budget right this second. THAT is the math. We could ZERO out defense and all discretionary spending and still have a deficit! Think about that...
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
