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S&P cuts ratings outlook for the US of A
Comments
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I just saw the headlines saying markets plunge and thinking the worst I took a look and say only 1-2% knocked off.
Since when was 1-2% is considered a plunge?
Since 1896 when the Daily Mail was first published,'Just think for a moment what a prospect that is. A single market without barriers visible or invisible giving you direct and unhindered access to the purchasing power of over 300 million of the worlds wealthiest and most prosperous people' Margaret Thatcher0 -
Sad that the rating agencies now seem to be running the US economy, wouldn't seem so bad if you were't aware of their ratings of semi junk CDO's before the great recession :eek:'Just think for a moment what a prospect that is. A single market without barriers visible or invisible giving you direct and unhindered access to the purchasing power of over 300 million of the worlds wealthiest and most prosperous people' Margaret Thatcher0
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I just saw the headlines saying markets plunge and thinking the worst I took a look and say only 1-2% knocked off.
Since when was 1-2% is considered a plunge?
Global mark down across all markets. Dow Jones a while back had no risers, red across the entire board. When the USA sneezes the rest of the world catches a cold.0 -
oddly US gilt prices improved today,suggesting the market has confidence in those who`s job it will be to cut govt spending0
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Freddie and Fannie were not supposed to be backed by the US government.
There was always an implicit guarantee. Even the 'Understanding the Financial Markets' course I did at Citibank in 1996 said that whilst there was no explicit guarantee on their debt, it was implied that it would be guaranteed in case of solvency problems.oddly US gilt prices improved today,suggesting the market has confidence in those who`s job it will be to cut govt spending
Safe haven. It's a knee jerk reaction.0 -
There was always an implicit guarantee. Even the 'Understanding the Financial Markets' course I did at Citibank in 1996 said that whilst there was no explicit guarantee on their debt, it was implied that it would be guaranteed in case of solvency problems.
Safe haven. It's a knee jerk reaction.
Oh the irony
'Just think for a moment what a prospect that is. A single market without barriers visible or invisible giving you direct and unhindered access to the purchasing power of over 300 million of the worlds wealthiest and most prosperous people' Margaret Thatcher0 -
Oh the irony
Sadly, despite what Goldbugs will have you believe, US Treasuries are the safest asset out there and that will continue until it stops. A US default would be a very traumatic experience (even an effective default via inflation) so most people prefer not to think about it.0 -
Sadly, despite what Goldbugs will have you believe, US Treasuries are the safest asset out there and that will continue until it stops. A US default would be a very traumatic experience (even an effective default via inflation) so most people prefer not to think about it.
on the one hand you say US treasuries are the safest asset out there. then you state, default is an option people don't like to think about.
make up your mind. either they're safe or they're not.0 -
on the one hand you say US treasuries are the safest asset out there. then you state, default is an option people don't like to think about.
make up your mind. either they're safe or they're not.
They're as safe as anything can be. Which is not to say anything is 100% safe.
WRT the possibility of default, they will likely maintain their safe haven status as long as the USA maintains it's AAA rating.
Remember a few years ago the same ratings agencies issued similar warnings about the UK's AAA rating, to the excitement of more than a few on here, whilst Germany was considered to be the poster boy for responsible fiscal management.
Yet now our debt is considered safer than Germany's.....
Things change.
What S&P have said is that IF the USA don't resolve their political differences over deficit reduction, there is a risk that their AAA rating COULD be downgraded at some point in the future.
Even if it was downgraded, there's a huge gap between that and default. Greece has been downgraded frequently in the last few years, and they've got none of the advantages of the USA, and even they haven't defaulted yet.“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0
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