US needs to be less corrupt to get their AAA rating back.

BGL said:
The Great Recession demonstrated that S&P's rating system has no meaning.
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Well, downgrading American debt was a logical idea. So they got that right.
As well, the meaning for Americans is this: your political system isn't working and you economy isn't so hot.
Your personal opinion doesn't lower the interest rate for American tax payers.
 
Digital Doctor said:
Well, downgrading American debt was a logical idea. So they got that right.
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S&P got absolutely nothing right as the last 30 years of hokey ratings and results have demonstrated. We have had record bankruptcies and frauds in the business world, all AAA rated by S&P. The rating is worthless other than as a sales tool used on gullible buyers of financial products.

As for downgrading US debt (whatever that is supposed to mean), US Debt/GDP is 67%, Germany's is 82% which shows how meaningless are the S&P "ratings".
 
it is time for scammers like S&P to be put out of business... everyone is happy to blaim banks for the current mess, but it was firms like s&P that told them the investment was AAA, somehow hey seem to have escaped any real criticism or financial penalty for what can only be seen as another form of insider trading or market manipulation
 
The real problem lies in the fact that government is stupid, regardless of where it is. We should have let the market enter a recession and get rid of its bad capital rather than propping it up by printing money which only led to an even bigger crash and weakened the dollar. I'm sorry, but unlike most people, I see just about every major recession in the history of the U.S. a direct result of government intervention, regulation, and interference into an otherwise healthy and self-correcting market.
 
a legacy reborn said:
The real problem lies in the fact that government is stupid.
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No the real problem is S&P is completely phony and its ratings worthless as every major economic disaster of last 30 years of the has had a AAA rating from S&P. S&P is as much a part of the scam as the Wall St. casino. The facts are clear.
 
dutchbb said:
Anyone who does not recognize that the gov is stupid has not paid enough attention.
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Wall St wasn't saying that when it was begging the "stupid government" to bail it out after Wall St drove itself off a cliff of stupidity and, relevant to this topic, stupid S&P saying "that's no cliff".
 
Government being stupid is a different issue but equally valid.... not just the US either the uk is just as bad

but the bottom line is as long as companies like S&P & the others are alowed to peddle snake oil to the financial industries and govrnment this kind of crap is still on the horizon
 
BGL said:
Wall St wasn't saying that when it was begging the "stupid government" to bail it out after Wall St drove itself off a cliff of stupidity and, relevant to this topic, stupid S&P saying "that's no cliff".
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It was the U.S. government that promoted the bad loans made by Fannie Mae and Freddie Mac. It was the idea that they all had that the government would not let them fail and so they could do whatever they wanted that led to the bail out. What did the government do? It proved them right. Don't blame Wall Street. Don't blame Capitalism. Capitalism is a perfect economic system, it is just the interference from government that screws things up. Your opinion on the S&P is irrelevant. People see it as a sign that the U.S. is not that healthy, and, to be honest, it's true. What caused the credit rating to be degraded? The government. If you start asking real question then you will find that at the center of them all is one common problem: government.
 
a legacy reborn said:
It was the U.S. government that promoted the bad loans made by Fannie Mae and Freddie Mac.
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And it was Wall St's dumb idea to privatize Fannie Mae and Mac...but the deal got AAA rating from S&P.

But it was Wall St. mortgage derivatives, not the stupidly privatized Mae and Mac that crashed the economy...all with that AAA S&P rating.
 
BGL said:
And it was Wall St's dumb idea to privatize Fannie Mae and Mac...but the deal got AAA rating from S&P.

But it was Wall St. mortgage derivatives, not the stupidly privatized Mae and Mac that crashed the economy...all with that AAA S&P rating.
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Okay, I can accept that S&P is stupid sometimes, who isn't? It was still correct in lowering the U.S. credit rating, as any firm would. The U.S. is heading for a fiscal cliff because of the Conservatives(both the Democratic and Republican parties are Conservative btw.)
 
a legacy reborn said:
Okay, I can accept that S&P is stupid sometimes, who isn't?
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S&P is a meaningless rating system owned and operated by Wall St to fluff worthless financial products. EVERY major bank, insurance, brokerage firm that went bankrupt in the Great Recession and begged for "stupid government" bailouts was rated AAA by S&P.[/quote]
 
BGL said:
S&P is a meaningless rating system owned and operated by Wall St to fluff worthless financial products. EVERY major bank, insurance, brokerage firm that went bankrupt in the Great Recession and begged for "stupid government" bailouts was rated AAA by S&P.
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I can agree with you that it fluffed the institutions(whether on purpose or not). However, I think the institutions only made such investments because they knew the government would help them out. I do not think that S&P thought that the institutions would do something so careless on the assumption(albeit, mostly correct) that the government would bail them out. It took S&P until after the crises to downgrade the institutions, much like it took them until after the crises to downgrade the U.S. credit rating, something that should have been done long ago.

The main point I'm trying to make, which may be off-topic, is that it is our Mercantilism that has lead to this crisis and S&P was justified in downgrading our credit, regardless of the reliability of their other ratings.
 
We lost our AAA rating because of high debt and uncontrolled spending. Our government has completely failed to curb the problem; in fact, our debt has increased by more than 6 trillion in less than 4 years. Our government has not even produced a budget in 4 years. That is why our country lost its AAA rating for the first time in history. Government is responsible for the money it spends, not companies.
 
Brad L said:
We lost our AAA rating because of high debt and uncontrolled spending.
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With the caveat that the "AAA" rating is meaningless, assigned to bankrupts, Ponzi schemes and anyone else willing to pay S&P for a rating.

Certainly the big jump in deficits and debt from 1980 to present, other than the period from 1992-2000 when US deficits were turned to surplus under sound fiscal management, is not a good thing. Prior to 1980 Debt/GDP ratio declined continuously from the 144% of World War II to a post WWII low of 30% in 1980. After 1980, with poor fiscal policies, US Debt/GDP rose steadily to 60% of GDP, declined slightly 92-00 to 56% and then rose again after 2000 to 70% and now in the 80% range due to the Great Recession.

However, US Debt/GDP is less than Germany, so certainly by any basic financial measure US would have a higher "S&P rating" than Germany since US ability to pay its debt is proportionally greater.

Brad L said:
Our government has completely failed to curb the problem
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We are the government. We voted in people who created the deficit and debt beginning in 1980 which saw radical economic ideology and huge jump in deficits, debt and Debt/GDP from WWII low of 30 to 54% in 12 years of fiscal fantasy. When we elected responsible leaders, '92-'00, our deficits turned to surplus and Debt/GDP declined. Decision time is upon us, do we elect the same failed fiscal policy that started US Debt rise in 1980 or do we elect the fiscal policies that produced the steadily decline in Debt/GDP from WWII to 1980 and then from '92-'00?

Brad L said:
our debt has increased by more than 6 trillion in less than 4 years.
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$3T of that to Wall St to save it from "AAA" S&P rated worthless "securities". Fascinating that S&P rated US "AAA" as it ran up massive deficits and debt and then lowers the rating as US deals with problems created by "AAA" ratings given to "derivatives scams" and junk bonds. S&P is meaningless as financial rating system. S&P has proven to be downright dangerous for anyone who pays attention to it.
 
Credit ratings are not meaningless. That's an absurd statement and I can only assume your understanding of economics is elementary.

Certainly the big jump in deficits and debt from 1980 to present, other than the period from 1992-2000 when US deficits were turned to surplus under sound fiscal management
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That's completely false. Clinton did not create a surplus during each year from 1992-2000. Are you lying on purpose in an attempt to fool people, or are you just ignorant about what you're talking about? You're putting politics ahead of truth and that's why our country is in trouble.
 
credit rating from some sources are meaningless when based on lies, bad information or just plain "what the custoner wants to hear"... & that is exactly what s&P amongst others were dishing up... indeed still are dishing up
 
Tell Spain and Greece that credit ratings are meaningless (y)
I think we're talking about two elements here. The integrity of the ratings and the effect those ratings have. I can understand and agree with the argument that some of the ways that credit ratings are calculated are unproductive and maybe even meaningless. However, the effect that those ratings have are very real and not meaningless.
 
Interesting article on Greece and Corruption.
which should point the US in the direction it needs to head towards to get their AAA rating back.

http://www.smh.com.au/world/greece-slips-in-corruption-index-20121206-2awp1.html

On top of the litany of woes that have befallen Greece, comes the news that the eurozone's weakest link is also its most corrupt. From holding 80th place in the 176 countries on Transparency International's corruption perceptions index in 2011, Greece's global ranking, this year, fell to 94, the global watchdog has announced.
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