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08-05-2011, 07:15 PM
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#41
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Moderator Emeritus
Join Date: May 2007
Posts: 12,901
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Well it's a done deal:
S&P Downgrades US Credit Rating to AA-Plus
S&P downgrades the US credit rating from AAA to AA+. Outlook remains negative.
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08-05-2011, 07:27 PM
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#42
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Full time employment: Posting here.
Join Date: Apr 2010
Posts: 717
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__________________
“The problem with the world is that the intelligent people are full of doubt, while the stupid people are full of confidence.”
(—Charles Bukowski)
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S&P Downgrades U.S. Debt for First Time
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08-05-2011, 07:27 PM
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#43
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Dryer sheet wannabe
Join Date: May 2010
Posts: 24
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S&P Downgrades U.S. Debt for First Time
From WSJ: S&P Downgrades U.S. Debt for First Time
 Quote:
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S&P removed for the first time the triple-A rating the U.S. has held for 70 years, saying the budget deal recently brokered in Washington didn't do enough to address the gloomy long-term picture for America's finances. It downgraded U.S. debt to AA+, a score that ranks below Liechtenstein and on par with Belgium and New Zealand.
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Thoughts on the impact?
__________________
Those who desire to give up freedom in order to gain security, will not have, nor do they deserve, either one. ~Ben Franklin
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08-05-2011, 07:30 PM
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#44
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Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Join Date: May 2004
Location: SW Ohio
Posts: 14,404
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I predict Congress will address the problem quickly. Citing a need to raise revenues, a new, high tax on "bond rating firms with bearish outlook on US debt" will be passed and signed.
Senator X: "There, we did something about it. How do they like them apples?!"
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08-05-2011, 07:48 PM
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#45
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Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Join Date: Dec 2006
Location: Collin County, TX
Posts: 9,296
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Here's a photo if you don't want to look at the link....
__________________
There's no need to complicate, our time is short..
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08-05-2011, 08:23 PM
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#46
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Thinks s/he gets paid by the post
Join Date: Aug 2007
Posts: 1,224
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Monday should be interesting. So where were these eagle eyed bond mavens when the MBS's were being rated?
DD
__________________
At 54% of FIRE target
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08-05-2011, 08:25 PM
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#47
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Gone but not forgotten
Join Date: Jan 2007
Location: Sarasota,fl.
Posts: 11,447
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When you start spending freely. I will consider that the white flag and jump back in ! 
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S&P downgrades U.S. credit rating for first time
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08-05-2011, 08:35 PM
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#48
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Recycles dryer sheets
Join Date: Mar 2007
Posts: 176
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S&P downgrades U.S. credit rating for first time
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08-05-2011, 08:37 PM
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#49
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Thinks s/he gets paid by the post
Join Date: May 2011
Location: South Eastern USA
Posts: 1,068
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Read the report. Obvious vote of no confidence in our current Congress and President.
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08-05-2011, 08:40 PM
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#50
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Thinks s/he gets paid by the post
Join Date: Oct 2004
Location: LaLa Land
Posts: 4,698
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Look out below!
__________________
Work is something you do to get enough $ so you don't have to....Me.
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08-05-2011, 09:35 PM
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#51
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Thinks s/he gets paid by the post
Join Date: Mar 2010
Posts: 1,994
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Just wait for all the commentary from other countries on this one. Think I will stuff my ears and close my eyes. I agree gsparks2...no vote of confidence in our government. Wonder if this will shake them up enough?
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08-05-2011, 09:52 PM
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#52
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Dryer sheet wannabe
Join Date: May 2010
Posts: 24
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The downgrade reflects recognition finally that the emperor has no clothes. The debt-ceiling bill was simply another in a long line of phony legislation that uses tricks in an attempt to hide the true nature of our economic condition. Follow the link to " Federal Budget 101," which uses a great analogy to explain how ineffective this latest legislation is in resolving our fiscal crisis.
__________________
Those who desire to give up freedom in order to gain security, will not have, nor do they deserve, either one. ~Ben Franklin
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08-05-2011, 10:03 PM
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#53
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Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Join Date: Oct 2005
Location: North Oregon Coast
Posts: 16,483
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I would agree on the "vote of no confidence" idea if these ratings agencies had any credibility - I have "no confidence" in them after all their "AAA-rated" toxic securities blew up 3 years ago.
__________________
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)
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08-05-2011, 10:15 PM
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#54
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Recycles dryer sheets
Join Date: May 2007
Posts: 444
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So Anyone care to look into their crystal ball and tell us what's going to happen with this downgrade??
Is it time to flee and move to cash??
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08-05-2011, 10:22 PM
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#55
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Dryer sheet wannabe
Join Date: May 2010
Posts: 24
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Hey, maybe the rest of the world will conclude the U.S. is too big to fail and bail us out... 
__________________
Those who desire to give up freedom in order to gain security, will not have, nor do they deserve, either one. ~Ben Franklin
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08-05-2011, 11:50 PM
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#56
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Full time employment: Posting here.
Join Date: May 2010
Posts: 862
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Quote:
Originally Posted by novaman
So Anyone care to look into their crystal ball and tell us what's going to happen with this downgrade??
Is it time to flee and move to cash??
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Even cash will give you problems; low rates of return from CDs and savings accounts; inflation which is inevitable will kill your buying power. Carrying large sums of cash invite crime.
There really is no place to hide - even foreign currencies such as the Euro, Yen and Sterling are struggling with their own troubles.
I will be hanging on to my bonds and dividend stocks- will probably still suffer principal loss, but at least they give a steady stream of income now that I'm ER with no pension, and not being able to take Soc Sec as yet.
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08-06-2011, 12:05 AM
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#57
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Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Join Date: Oct 2006
Posts: 7,733
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Quote:
Originally Posted by ziggy29
I would agree on the "vote of no confidence" idea if these ratings agencies had any credibility - I have "no confidence" in them after all their "AAA-rated" toxic securities blew up 3 years ago.
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I agree on the irony of the ratings agencies, but a broken clock ....
Still I expect that we will see the 4 AAA US companies JNJ, MSFT, XON, and ADP to eventually end up with lower interest rate cost than the US government. I am surprised we haven't seen before. I think if the companies get creative they'll do even better.
Imagine that Exxon starts issuing oil bonds. For the price of 10 barrels of oil today, Exxon agrees to give me 10 barrels of oil in Aug 2021. As interest payment they give me .25 barrels each year which can be easily converted in the currency of my choice Euro/Yen/$/RMB. That is the equivalent of a 10 year US T-bond with a 2.5% interest rate.
For me personally eventhough the interest rates are nominally the same, my confidence that the Exxon will be able to give me 10 barrels of oil,and 2.5 barrels in interest payments over the next 10 years is much higher than that Uncle Sam will give me dollars that are worth much in 10 years.
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08-06-2011, 12:33 AM
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#58
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Moderator Emeritus
Join Date: Sep 2007
Posts: 17,774
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In something I read tonight, the analysts said Mr. Market had already factored this downgraded rating possibility into things. I don't know exactly what that means will happen on Monday.
__________________
“Would you like an adventure now, or would you like to have your tea first?” J.M. Barrie, Peter Pan
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08-06-2011, 04:39 AM
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#60
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Thinks s/he gets paid by the post
Join Date: Sep 2010
Location: midwestern city
Posts: 4,061
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Hello Bestwifeever - I predict the Dow will be up on Monday. Buy when people are afraid, sell when people are greedy.
Quote:
Originally Posted by Bestwifeever
I don't know exactly what that means will happen on Monday.
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__________________
Very conservative with investments. Not ER'd yet, 48 years old. Please do not take anything I write or imply as legal, financial or medical advice directed to you. Contact your own financial advisor, healthcare provider, or attorney for financial, medical and legal advice.
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