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  4. rating agencies power

rating agencies power

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  • W Offline
    W Offline
    wolfbinary
    wrote on last edited by
    #1

    If rating agencies can down grade the credit worthiness of a country don't they hold a form of power over them? They just down graded the US's outlook to negative. Could this play into the lack of regulatory changes with regards to them? I can see that play in the cards. Why not? Economics can be just as damaging as military weapons. People or companies with that kind of money aren't beholden to any country nor do they have the same patriotic notions as people less economically mobile. See http://latimesblogs.latimes.com/money_co/2011/04/us-credit-rating-outlook-lowered-to-negative-by-standard-poors.html[^]

    That's called seagull management (or sometimes pigeon management)... Fly in, flap your arms and squawk a lot, crap all over everything and fly out again... by _Damian S_

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    • W wolfbinary

      If rating agencies can down grade the credit worthiness of a country don't they hold a form of power over them? They just down graded the US's outlook to negative. Could this play into the lack of regulatory changes with regards to them? I can see that play in the cards. Why not? Economics can be just as damaging as military weapons. People or companies with that kind of money aren't beholden to any country nor do they have the same patriotic notions as people less economically mobile. See http://latimesblogs.latimes.com/money_co/2011/04/us-credit-rating-outlook-lowered-to-negative-by-standard-poors.html[^]

      That's called seagull management (or sometimes pigeon management)... Fly in, flap your arms and squawk a lot, crap all over everything and fly out again... by _Damian S_

      L Offline
      L Offline
      Lost User
      wrote on last edited by
      #2

      Negative? How does that rate with the AAA etc rating? And yes, they can have a big impact on the desirability of a product they rate. And yes, the US is mightilly fucked. The problem is it has been for decades and no one seems to care. :)

      Dr D Evans "The whole idea that carbon dioxide is the main cause of the recent global warming is based on a guess that was proved false by empirical evidence during the 1990s" financialpost

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      • W wolfbinary

        If rating agencies can down grade the credit worthiness of a country don't they hold a form of power over them? They just down graded the US's outlook to negative. Could this play into the lack of regulatory changes with regards to them? I can see that play in the cards. Why not? Economics can be just as damaging as military weapons. People or companies with that kind of money aren't beholden to any country nor do they have the same patriotic notions as people less economically mobile. See http://latimesblogs.latimes.com/money_co/2011/04/us-credit-rating-outlook-lowered-to-negative-by-standard-poors.html[^]

        That's called seagull management (or sometimes pigeon management)... Fly in, flap your arms and squawk a lot, crap all over everything and fly out again... by _Damian S_

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        O Offline
        Oakman
        wrote on last edited by
        #3

        Whether we like it or not the U.S. economy is heading at full speed toward an economic cliff. For S & P to ignore the stupidities of the American government for the last ten years, would be unprofessional and maybe even criminal.

        Where there's sacrifice, there's someone collecting the sacrificial offerings. Where there's service, there is someone being served. The man who speaks to you of sacrifice is speaking of slaves and masters, and intends to be the master. ~ Ayn Rand

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        • L Lost User

          Negative? How does that rate with the AAA etc rating? And yes, they can have a big impact on the desirability of a product they rate. And yes, the US is mightilly fucked. The problem is it has been for decades and no one seems to care. :)

          Dr D Evans "The whole idea that carbon dioxide is the main cause of the recent global warming is based on a guess that was proved false by empirical evidence during the 1990s" financialpost

          L Offline
          L Offline
          Lost User
          wrote on last edited by
          #4

          Their AAA rating is as was, but this is a warning shot that if they don't address this (long term deficits) pretty quick, their rating could be future rated towards some negative score.

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          • L Lost User

            Negative? How does that rate with the AAA etc rating? And yes, they can have a big impact on the desirability of a product they rate. And yes, the US is mightilly fucked. The problem is it has been for decades and no one seems to care. :)

            Dr D Evans "The whole idea that carbon dioxide is the main cause of the recent global warming is based on a guess that was proved false by empirical evidence during the 1990s" financialpost

            W Offline
            W Offline
            wolfbinary
            wrote on last edited by
            #5

            fat_boy wrote:

            Negative? How does that rate with the AAA etc rating?

            Apparently a negative rating is an outlook rating.

            That's called seagull management (or sometimes pigeon management)... Fly in, flap your arms and squawk a lot, crap all over everything and fly out again... by _Damian S_

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            • O Oakman

              Whether we like it or not the U.S. economy is heading at full speed toward an economic cliff. For S & P to ignore the stupidities of the American government for the last ten years, would be unprofessional and maybe even criminal.

              Where there's sacrifice, there's someone collecting the sacrificial offerings. Where there's service, there is someone being served. The man who speaks to you of sacrifice is speaking of slaves and masters, and intends to be the master. ~ Ayn Rand

              W Offline
              W Offline
              wolfbinary
              wrote on last edited by
              #6

              Oakman wrote:

              For S & P to ignore the stupidities of the American government for the last ten years, would be unprofessional and maybe even criminal.

              All of them have been made effectively immune from prosecutions for any of their ill conceived ratings. If the government paid them for their ratings the way Wallstreet paid for theirs we'd have AAA for all eternity.

              That's called seagull management (or sometimes pigeon management)... Fly in, flap your arms and squawk a lot, crap all over everything and fly out again... by _Damian S_

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              • W wolfbinary

                Oakman wrote:

                For S & P to ignore the stupidities of the American government for the last ten years, would be unprofessional and maybe even criminal.

                All of them have been made effectively immune from prosecutions for any of their ill conceived ratings. If the government paid them for their ratings the way Wallstreet paid for theirs we'd have AAA for all eternity.

                That's called seagull management (or sometimes pigeon management)... Fly in, flap your arms and squawk a lot, crap all over everything and fly out again... by _Damian S_

                O Offline
                O Offline
                Oakman
                wrote on last edited by
                #7

                wolfbinary wrote:

                All of them have been made effectively immune from prosecutions for any of their ill conceived ratings. If the government paid them for their ratings the way Wallstreet paid for theirs we'd have AAA for all eternity.

                Possibly, but unlike the CDS's, the deficit, which increased by 50% in the last two years, is neither difficult to measure, nor hard to understand. IF S&P tried to pretend there was nothing wrong, they'd be ignored, or become a laughingstock.

                Where there's sacrifice, there's someone collecting the sacrificial offerings. Where there's service, there is someone being served. The man who speaks to you of sacrifice is speaking of slaves and masters, and intends to be the master. ~ Ayn Rand

                1 Reply Last reply
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                • W wolfbinary

                  If rating agencies can down grade the credit worthiness of a country don't they hold a form of power over them? They just down graded the US's outlook to negative. Could this play into the lack of regulatory changes with regards to them? I can see that play in the cards. Why not? Economics can be just as damaging as military weapons. People or companies with that kind of money aren't beholden to any country nor do they have the same patriotic notions as people less economically mobile. See http://latimesblogs.latimes.com/money_co/2011/04/us-credit-rating-outlook-lowered-to-negative-by-standard-poors.html[^]

                  That's called seagull management (or sometimes pigeon management)... Fly in, flap your arms and squawk a lot, crap all over everything and fly out again... by _Damian S_

                  L Offline
                  L Offline
                  Lost User
                  wrote on last edited by
                  #8

                  "Moody's Maintain Top US Rating, Outlook Positive." There, there, that nice, patriotic, Mr Buffett has made it all better.

                  Everybody is elitist to a certain extent; except me - I'm better than that. Micah

                  1 Reply Last reply
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                  • W wolfbinary

                    If rating agencies can down grade the credit worthiness of a country don't they hold a form of power over them? They just down graded the US's outlook to negative. Could this play into the lack of regulatory changes with regards to them? I can see that play in the cards. Why not? Economics can be just as damaging as military weapons. People or companies with that kind of money aren't beholden to any country nor do they have the same patriotic notions as people less economically mobile. See http://latimesblogs.latimes.com/money_co/2011/04/us-credit-rating-outlook-lowered-to-negative-by-standard-poors.html[^]

                    That's called seagull management (or sometimes pigeon management)... Fly in, flap your arms and squawk a lot, crap all over everything and fly out again... by _Damian S_

                    M Offline
                    M Offline
                    Majerus
                    wrote on last edited by
                    #9

                    Perhaps, sometime in the next 2 years, they might downgrade the US credit rating. Doesn't mean too much really. It might help as one more voice pointing out a need for action by "policy makers". They do make it clear that reigning in short term deficits are not their concern, rather the need for "long term measures to reign in the rising national debt". Until such time as the Republicans become serious about deficits rather than using them as an excuse to defund Planned Parenthood or destroy public sector unions it will be difficult to resolve.

                    1 Reply Last reply
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                    • W wolfbinary

                      If rating agencies can down grade the credit worthiness of a country don't they hold a form of power over them? They just down graded the US's outlook to negative. Could this play into the lack of regulatory changes with regards to them? I can see that play in the cards. Why not? Economics can be just as damaging as military weapons. People or companies with that kind of money aren't beholden to any country nor do they have the same patriotic notions as people less economically mobile. See http://latimesblogs.latimes.com/money_co/2011/04/us-credit-rating-outlook-lowered-to-negative-by-standard-poors.html[^]

                      That's called seagull management (or sometimes pigeon management)... Fly in, flap your arms and squawk a lot, crap all over everything and fly out again... by _Damian S_

                      W Offline
                      W Offline
                      wizardzz
                      wrote on last edited by
                      #10

                      Just wait until the fed reserve bank (which is not the government for those of us that are unaware) quits buying the majority of T bills this summer, stopping the value from being artificially inflated. That will upset China, resulting in foreign sell offs of T bills, dumping the currency, forcing exchanges and companies to stop using the USD as the default trading currency.

                      Craigslist Troll: litaly@comcast.net "I have a theory that the truth is never told during the nine-to-five hours. " — Hunter S. Thompson

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