S&P downgrades US credit ratinghttp://finance.yahoo.com/news/SampP-downgrades-US-cre

[eriksat1]

We have been heading down this road for a long time, it comes as no surprise. With the childish bickering in Washington, all those morons need to get booted out of office. We don't need life long politicians we need some people with common sense in office. Prepare for credit rates to go up across the board. Pay off all your credit cards asap. We locked in a fixed rate last fall on our home mortgage at 4.5% If a person is going to be able to get ahead at all in this economy you better be debt free, I'm almost there except for the house mortgage, but it's better than paying rent.

[vteye]

Question is will the world continue to buy AA debt.

[Dodge1]

Question is will the world continue to buy AA debt.

Yes, but probably not at the interest rates before the downgrade; which will only add to our deficit.

If you take a look at what Greece, Ireland etc. are paying in order to sell their bonds, we can only hope that we don't get a further downgrade.

[KRAMER2000]

You have to remember these were the same rating agencies that gave AAA ratings to all those wonderful mortgages that turned out so well for the country. How anybody could take what they say with a grain of salt they have to have a very short memory. The old AAA is now the new AA+. :muahaha:

[mudpuppy]

You have to remember these were the same rating agencies that gave AAA ratings to all those wonderful mortgages that turned out so well for the country. How anybody could take what they say with a grain of salt they have to have a very short memory. The old AAA is now the new AA+. :muahaha:

My thoughts exactly. Ratings agencies have no credibility. They just rate according to their own self serving purposes. Always have, always will. I'm sure there will be some sort of market reaction, but it's a non news issue, been coming for a long time. The whole world knows the US has to get their fiscal house in order.

[eriksat1]

But just like anyone else the lower the rating the higher the interest rate. We will be down to AA soon. This will not be a quick fix.

[T Mac]

Sad, isn't it.
But - I don't know of any individuals or companies that could get a loan at all, if their debt is equal to their gross income.
The credit agencies like S&P, just crunch numbers and the numbers yield the score. It is what it is.
Smoke and mirrors don't have any effect on calculators.

[AllenW]

Just a reminder posts that get political will disappear.



Doesn't look good for us does it?
They (TV) were talking about 401k's and the fact they could suffer from all this...

Al

[yarcraft91]

The downgrade comes as no surprise- we were warned to expect this all through July. Too early to say if it will make any real difference beyond embarrassment for those who let it happen. Investors world-wide need a currency to trust- what better options do they have for stashing trillions of dollars?

I've got some near-term money in a 401K account that pays 125% of the 10 trailing average of 10-year T-bonds. If interest rates go up, this account will benefit from the downgrade.

[rebs]

it is a shame the way this country is being run into the ground

[mudpuppy]

Sad, isn't it.
But - I don't know of any individuals or companies that could get a loan at all, if their debt is equal to their gross income.
The credit agencies like S&P, just crunch numbers and the numbers yield the score. It is what it is.
Smoke and mirrors don't have any effect on calculators.

Another example of S&P's incompetence/credibility. They made a 2 trillion $ mistake in their calculations. Don't get me wrong, they're probably justified anyway. I think what their whole point is the governments incompetence/credibility was brought into question when the debt talks stalled and what was finally passed.

[yarcraft91]

Another example of S&P's incompetence/credibility. They made a 2 trillion $ mistake in their calculations. Don't get me wrong, they're probably justified anyway. I think what their whole point is the governments incompetence/credibility was brought into question when the debt talks stalled and what was finally passed.

I think S&P did the right thing. They said- well in advance- that the US needed to show a concrete plan to cut spending by $4T over ten years. What passed was a plan to cut $2.4T. So, with too little cost-cutting commitment, S&P followed through. If S&P wants credibility, they had no choice here.

[rpieske]

The "plan" supposedly cuts the deficit by $2.4 Trillion over the next decade. In spite of this, the COB predicts the deficit will rise by $7 Trillion over the same period. Congress is pi$$ing on our legs and telling us it's raining. We don't need an election...we need a flush.

[Further North]

They (TV) were talking about 401k's and the fact they could suffer from all this...

Al

That it will happen is without doubt - how long it will last and the long term effect is up in the air.

Long term, consistent and conservative* investors typically look at situations like this as opportunities to buy solid stocks at better prices and hang onto to them until they recover to values that mirror their true value. Many of them came out of the last serious down turn looking very good.

*Conservative in terms of investing, not politics.

[AllenW]

That it will happen is without doubt - how long it will last and the long term effect is up in the air.

Long term, consistent and conservative* investors typically look at situations like this as opportunities to buy solid stocks at better prices and hang onto to them until they recover to values that mirror their true value. Many of them came out of the last serious down turn looking very good.

*Conservative in terms of investing, not politics.


Doesn't do much for us old farts about to retire, no recovery time here, but yes I suppose if I was younger and had money to invest I might....but considering the direction we're going, probably not.

Al

[Jimmy Jig]

The might help the banks pay better interest on CD's. Last one renewed was under one percent!

[yarcraft91]

It amusing how many stories I've seen that the current administration is complaining about S&P's analysis and subsequent credit downgrade. Also amusing how many stories about how the administration tried to talk S&P out of the downgrade. This is even slightly newsworthy? Isn't that what you would expect any administration to do?

I have to believe that story has happened thousands of times after a credit-rating agency advised a company or government that a credit downgrade was in the works.

CEO- "Oh no- don't do that- you must be wrong- our credit is sound- no problem- what's the matter with you people?"

S&P- "No, Mr. Skilling- we're not buying your story." ...or something like that.

[rebs]

how much more can the American people be hurt ?
It seems like we are being gutted before we are dead.
Take take take, how much more do they want to take from us ?
It sure seems like the big buisnesses are running the country with their greed and the government is no longer in control.

[mudpuppy]

Futures look dismal for tomorrow in the market. But oil is down, too.
http://www.bloomberg.com/news/2011-08-07/u-s-stock-futures-oil-plunges-on-rating-downgrade-n-z-index-declines.html

[KRAMER2000]

I'm suprised that the powers that be haven't dusted this post. Any hint of politics should be a poof. They all must be taking the weekend off. I've posted simular and could barely make it into print.???????????????

[v-bay gord]

I'm suprised that the powers that be haven't dusted this post. Any hint of politics should be a poof. They all must be taking the weekend off. I've posted simular and could barely make it into print.???????????????

I think they do not mind thoughtful discussion, regardless of the topic. Unfortunately the thoughtfullness usually doesn't last long. The topic is very relavent and I for one find the opinions so far to be informative. Keep it up!