The U.S. lost its top credit grade in August because of the imminent danger of a “real liquidity crisis,” and Standard & Poor’s made no errors in its analysis, said Moritz Kraemer, managing director of sovereign ratings.
It’s unlikely that any political agreement reached in the coming months to cut the U.S. government’s budget deficit will go far enough, said David Beers , Standard & Poor’s global head of sovereign and international public finance ratings.
Standard & Poor’s, the rating company that downgraded the debt of the United States to AA+ from AAA for the first time, now finds itself assailed by investors led by billionaire Warren Buffett for making a political decision that has more to do with Tea Party politics than the financial stability of the U.S.
Eleven days after lowering the credit rating on the U.S. for the first time, Standard & Poor’s is suffering a downgrade among global investors as American bonds are proving world beaters -- undermining S&P’s mathematical assumptions -- and prompting disbelief among political scientists months after the company upgraded China because of the stability fostered by Communist Party rule.
Standard & Poor’s downgraded the U.S.’s AAA credit rating for the first time, slamming the nation’s political process and criticizing lawmakers for failing to cut spending or raise revenue enough to reduce record budget deficits.
Former Federal Reserve Chairman Alan Greenspan said he expects stocks to continue their decline after Standard & Poor’s downgraded the nation’s credit rating, even as an S&P official predicted little market impact.
The e-mail message that unleashed hours of debate between U.S. Treasury Department officials and Standard & Poor’s arrived at 1:45 p.m. on Aug. 5, just as U.S. and European stock markets were limping toward the end of their worst week since 2008.