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U.S has lost AAA rating

  • 06-08-2011 12:29am
    #1
    Registered Users, Registered Users 2 Posts: 969 ✭✭✭


    S&P have just downgraded America's credit rating from AAA...


Comments

  • Registered Users, Registered Users 2 Posts: 1,379 ✭✭✭Smcgie


    Link? BBC are saying that they were thinking about it but they got their figures wrong by trillions!


  • Registered Users, Registered Users 2 Posts: 969 ✭✭✭murrayp4




  • Registered Users, Registered Users 2 Posts: 1,379 ✭✭✭Smcgie


    This news has obviously been about for a couple of days.. As usual the II's know well in advance and feather their own nests! Disgrace...


  • Registered Users, Registered Users 2 Posts: 1,379 ✭✭✭Smcgie




  • Registered Users, Registered Users 2 Posts: 7,940 ✭✭✭ballsymchugh


    anyone know who they're answerable to, and why do their OPINIONS matter so much? the amount of chaos they cause is crazy. ivan yates tried to tackle it one friday morning in january or february but they just avoided the question.


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  • Registered Users, Registered Users 2 Posts: 1,379 ✭✭✭Smcgie


    How are these agencies such as s&p and moodys actually financed? They don't make money from forecasting do they?


  • Closed Accounts Posts: 2,948 ✭✭✭gizmo555


    Smcgie wrote: »
    How are these agencies such as s&p and moodys actually financed? They don't make money from forecasting do they?
    Generally speaking, at least for corporate bonds, the issuer of the bonds pays the rating agency for rating them.

    It's hard to know how seriously to take these ratings. This decision has been flagged for a long time and seems mainly to have been delayed by massive political pressure, which in principle should have no bearing on the matter. It's notable that S&P has gone out of it's way in its statement to spread the blame evenly between Republicans and Democrats (which is in itself highly debatable).

    And, as Paul Krugman says in the NY Times these guys have not exactly covered themselves in glory with past rating decisions.

    On one hand, there is a case to be made that the madness of the right has made America a fundamentally unsound nation. And yes, it is the madness of the right: if not for the extremism of anti-tax Republicans, we would have no trouble reaching an agreement that would ensure long-run solvency.

    On the other hand, it’s hard to think of anyone less qualified to pass judgment on America than the rating agencies. The people who rated subprime-backed securities are now declaring that they are the judges of fiscal policy? Really?


  • Closed Accounts Posts: 2,078 ✭✭✭Hal Emmerich


    Smcgie wrote: »
    How are these agencies such as s&p and moodys actually financed? They don't make money from forecasting do they?
    Bear sterns Bank had a Triple A rating when it collapsed, I'm near sure Lehmans and Washington Mutual had aswell, they payed the rating agency to rate them, how can that be objective.

    *All those subprime housing estates pilled together into bonds or CDOs whatever they were called.....they were paid to rate them aswell.

    Whatever about how they are funded, I can't understand why anyone listens to them.

    *I'm no expert.


  • Registered Users, Registered Users 2 Posts: 300 ✭✭Speculator


    Suggestions that the downgrade was already priced into the market:

    Bloomberg:
    http://www.bloomberg.com/video/73607314/


  • Registered Users, Registered Users 2 Posts: 300 ✭✭Speculator




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  • Registered Users, Registered Users 2 Posts: 766 ✭✭✭displaced dub


    Personally i have zero faith in the ratings agencies, these were giving out AAA for the craig back in the day and a lot of people put their trust in those ratings and they, where then, as they most likely are now, a pile of ****e.

    Im fairly sure the entire irish banking sector along with irish debt was all AAA back in 06/07.

    I also feel the market has priced in the downgrade


  • Closed Accounts Posts: 872 ✭✭✭martyoo


    The only problem with rating agencies is that people listen to them! :)


  • Registered Users, Registered Users 2 Posts: 3,046 ✭✭✭BailMeOut


    Personally i have zero faith in the ratings agencies, these were giving out AAA for the craig back in the day and a lot of people put their trust in those ratings and they, where then, as they most likely are now, a pile of ****e.

    Im fairly sure the entire irish banking sector along with irish debt was all AAA back in 06/07.

    I also feel the market has priced in the downgrade

    http://business.timesonline.co.uk/tol/business/economics/article6005518.ece

    Ireland was downgraded from AAA in March 2009.


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