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US Loses AAA Credit Rating
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Limey Polo
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eegleindia
BLACK SNOW 13
Meatshield718
eaustinn36
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US Loses AAA Credit Rating
eaustinn36 6th August 2011, 2:56 pm
What does it mean? Well, we have to pay more money in interest when borrowing money for one. this article sums up the rest:
http://today.msnbc.msn.com/id/44040574/ns/business-stocks_and_economy/#.Tj1_p4LSb14
Thoughts?
So... there is a part 2 to this post. Now that the US is downgraded, what countries have an AAA rating still? Take the quiz to see how many you can get:
http://www.sporcle.com/games/dm21uk/aaa
http://today.msnbc.msn.com/id/44040574/ns/business-stocks_and_economy/#.Tj1_p4LSb14
Thoughts?
So... there is a part 2 to this post. Now that the US is downgraded, what countries have an AAA rating still? Take the quiz to see how many you can get:
http://www.sporcle.com/games/dm21uk/aaa
- Spoiler:
- got 13/15
eaustinn36- Master
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Re: US Loses AAA Credit Rating
Meatshield718 6th August 2011, 3:03 pm
I missed two, but got the bonus point ones.
Meatshield718- Master
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Re: US Loses AAA Credit Rating
BLACK SNOW 13 6th August 2011, 3:49 pm
Okay, let's take MIT, Georgia Tech, Baylor, Brown, Columbia, Cal tech and Rice off the list of colleges I want to go to.
BLACK SNOW 13- The Great and Powerful
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Re: US Loses AAA Credit Rating
Meatshield718 6th August 2011, 4:03 pm
BLACK SNOW 13 wrote:Okay, let's take MIT, Georgia Tech, Baylor, Brown, Columbia, Cal tech and Rice off the list of colleges I want to go to.
I'm confused by this statement. Are you being sarcastic?
Meatshield718- Master
- Posts : 2316
Re: US Loses AAA Credit Rating
BLACK SNOW 13 6th August 2011, 6:53 pm
No I am being realistic. I almost have the grades and scores for most of those schools to go to. Those schools are pricier to go to and it would be better to kind of put those to the side.Meatshield718 wrote:BLACK SNOW 13 wrote:Okay, let's take MIT, Georgia Tech, Baylor, Brown, Columbia, Cal tech and Rice off the list of colleges I want to go to.
I'm confused by this statement. Are you being sarcastic?
BLACK SNOW 13- The Great and Powerful
- Posts : 4232
Re: US Loses AAA Credit Rating
eaustinn36 6th August 2011, 7:47 pm
BLACK SNOW 13 wrote:No I am being realistic. I almost have the grades and scores for most of those schools to go to. Those schools are pricier to go to and it would be better to kind of put those to the side.Meatshield718 wrote:BLACK SNOW 13 wrote:Okay, let's take MIT, Georgia Tech, Baylor, Brown, Columbia, Cal tech and Rice off the list of colleges I want to go to.
I'm confused by this statement. Are you being sarcastic?
And how is this related to the topic whatsoever?
eaustinn36- Master
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Re: US Loses AAA Credit Rating
BLACK SNOW 13 6th August 2011, 9:18 pm
Students loans. God how dense can you be?eaustinn36 wrote:BLACK SNOW 13 wrote:No I am being realistic. I almost have the grades and scores for most of those schools to go to. Those schools are pricier to go to and it would be better to kind of put those to the side.Meatshield718 wrote:BLACK SNOW 13 wrote:Okay, let's take MIT, Georgia Tech, Baylor, Brown, Columbia, Cal tech and Rice off the list of colleges I want to go to.
I'm confused by this statement. Are you being sarcastic?
And how is this related to the topic whatsoever?
BLACK SNOW 13- The Great and Powerful
- Posts : 4232
Re: US Loses AAA Credit Rating
eegleindia 6th August 2011, 11:42 pm
BLACK SNOW 13 wrote:Students loans. God how dense can you be?eaustinn36 wrote:BLACK SNOW 13 wrote:No I am being realistic. I almost have the grades and scores for most of those schools to go to. Those schools are pricier to go to and it would be better to kind of put those to the side.Meatshield718 wrote:BLACK SNOW 13 wrote:Okay, let's take MIT, Georgia Tech, Baylor, Brown, Columbia, Cal tech and Rice off the list of colleges I want to go to.
I'm confused by this statement. Are you being sarcastic?
And how is this related to the topic whatsoever?
Correct me if I'm wrong, but I think this means that the US government's credit rating when borrowing from banks is down... Not US citizens... You sure you have the grades to get in to MIT?
eegleindia- Hail to the King Baby.
- Posts : 383
Re: US Loses AAA Credit Rating
ABigSoggy Wafle 6th August 2011, 11:57 pm
GotemCourtyard Droll wrote:
Correct me if I'm wrong, but I think this means that the US government's credit rating when borrowing from banks is down... Not US citizens... You sure you have the grades to get in to MIT?
ABigSoggy Wafle- Cry Owes Me A Custom Title
- Posts : 1833
Re: US Loses AAA Credit Rating
Jagdgeschwader 7th August 2011, 12:56 am
eaustinn36 wrote:
So... there is a part 2 to this post. Now that the US is downgraded, what countries have an AAA rating still? Take the quiz to see how many you can get:
http://www.sporcle.com/games/dm21uk/aaa
You're not supposed to put the word 'an' before the word (for lack of a better word) 'AAA' because it's pronounced "Triple A".
Also, AA+ is still a very good rating. I really think everyone is overreacting to this. It's not like the sky is falling.
My opinion on why the credit agencies lowered our credit rating? A plan that allows us to raise the debt ceiling 2 Trillion now and cut 1 trillion in spending over ten years is complete BS to the credit agencies. They don't think we're serious enough and lowered our rating. AA+ was very generous of them. I'm surprised they didn't do something along the lines of C-.
Jagdgeschwader- The Unknown Soldier
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Re: US Loses AAA Credit Rating
BLACK SNOW 13 7th August 2011, 2:09 am
Well if the u.s. credit is down, then the value of a dollar is down, thus interstate for loans are going to be higher. But I may be wrong.Courtyardroll wrote: DroCorrect me if I'm wrong, but I think this means that the US government's credit rating when borrowing from banks is down... Not US citizens... You sure you have the grades to get in to MIT?
Well I missed this need to wrong on my English. That is my only drawback.
BLACK SNOW 13- The Great and Powerful
- Posts : 4232
Re: US Loses AAA Credit Rating
Meatshield718 7th August 2011, 3:34 pm
I'm sorry, but are you sure that English is your first language?
I mean honestly I had to read that a couple of times to actually understand what you meant.
T_T
I mean honestly I had to read that a couple of times to actually understand what you meant.
T_T
Meatshield718- Master
- Posts : 2316
Re: US Loses AAA Credit Rating
BLACK SNOW 13 7th August 2011, 3:54 pm
Lol mu phone completely mess up that post. My scores in english are not high enough. XD
BLACK SNOW 13- The Great and Powerful
- Posts : 4232
Re: US Loses AAA Credit Rating
Limey Polo 8th August 2011, 2:28 am
The US is feeling partially depressed today and may blow itself up with a nuke. 
I mean, he is forced to be happy with his yatch when China won't trust him to borrow a private jet.
I mean, he is forced to be happy with his yatch when China won't trust him to borrow a private jet. 
Limey Polo- Zombies dun like meh.
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Re: US Loses AAA Credit Rating
DeadApe 8th August 2011, 5:06 pm
The market went down exactly 6.66% today.
DeadApe- Master
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Re: US Loses AAA Credit Rating
A Groovy Tophat 8th August 2011, 5:13 pm
DeadApe wrote:The market went down exactly 6.66% today.
SHHIIIIIITTT.
Welp.. we're fucked.
Also 6.66% in one day? O.o
A Groovy Tophat- A Tip Of The Hat
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Re: US Loses AAA Credit Rating
DeadApe 8th August 2011, 5:19 pm
Yea I've been following it at work all day. I was saying how crazy it was when it dropped 2%.
DeadApe- Master
- Posts : 6353
Re: US Loses AAA Credit Rating
A Groovy Tophat 8th August 2011, 5:28 pm
DeadApe wrote:Yea I've been following it at work all day. I was saying how crazy it was when it dropped 2%.
6.66% is a HUGE drop for one day. Im pretty sure we're fucked imo.
A Groovy Tophat- A Tip Of The Hat
- Posts : 2447
Re: US Loses AAA Credit Rating
steveeeee 8th August 2011, 9:29 pm
Tophat 44 wrote:6.66%
obama is the anti christ, thats the only logical explanation.
steveeeee- Hail to the King Baby.
- Posts : 391
Re: US Loses AAA Credit Rating
eaustinn36 8th August 2011, 10:42 pm
It would've been a crapload more than that if we defaulted. It was bound to drop either way.
eaustinn36- Master
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Re: US Loses AAA Credit Rating
eaustinn36 15th January 2012, 2:20 am
Bumping this on the account of current events.
The US is alone no longer..
http://www.bloomberg.com/news/2012-01-13/france-to-lose-aaa-from-s-p-afp-says-citing-state-official.html
The US is alone no longer..
http://www.bloomberg.com/news/2012-01-13/france-to-lose-aaa-from-s-p-afp-says-citing-state-official.html
- Spoiler:
- Article (if link void):
Nine Euro Nations’ Ratings Cut, Seven Affirmed
"France and Austria lost their top credit ratings in a string of downgrades that left Germany with the euro area’s only stable AAA grade as Standard & Poor’s warned that crisis-fighting efforts are still falling short.
France and Austria were cut one level to AA+ from AAA and face the risk of further reductions, the rating company said in Frankfurt late yesterday. While Finland, the Netherlands and Luxembourg kept their AAA ratings, they were put on negative watch. Spain and Italy were also among the nine nations downgraded.
“In our view, the policy initiatives taken by European policy makers in recent weeks may be insufficient to fully address ongoing systemic stresses in the euro zone,” S&P said in a statement.
The first gauge of the report’s impact will come in two days when France sells as much as 8.7 billion euros ($11 billion) in bills. History shows yields may not rise much, at least initially. Ten-year yields for the nine sovereign borrowers that lost their AAA ratings between 1998 and the U.S.’s downgrade in August rose an average of two basis points in the following week, according to JPMorgan Chase & Co.
Treasuries Rise
The yield on France ’s equivalent 10-year debt rose 3 basis points to 3.055 percent yesterday as news of the downgrade leaked. Italy’s 10-year yield climbed 1 basis point to 6.596 percent.
While S&P’s full announcement came after the close of trading in Europe, U.S. Treasuries rose, pushing yields to the lowest levels this year as investors sought the safety of U.S. government debt. Yields on 10-year notes fell six basis points, or 0.06 percentage point, to 1.87 percent at 5 p.m. New York time. They touched 1.83 percent, the lowest level since Dec. 20, according to Bloomberg Bond Trader prices. The benchmark 2 percent security maturing in November 2021 gained 16/32, or $5 per $1,000 face amount, to 101 6/32.
Third Year
S&P acted at the end of a week in which signs grew that Europe’s woes may be cresting as borrowing costs fell, evidence of economic resilience emerged and the European Central Bank said it had quelled a credit crunch at banks.
“Perhaps this will now concentrate the minds of EU policy makers making them realize that no country is immune to being pulled down by the euro crisis,” said Sony Kapoor, managing director of policy advisory firm Re-Define in Brussels. “The downgrades have now been expected for weeks so this should blunt some of the impact they would otherwise have had.”
European leaders are still struggling to tame a crisis now in its third year and convince investors they can restore budget order. The French downgrade may make it harder for the euro region's bailout fund to raise money and Greece’s creditors yesterday suspended talks with its government having failed to agree about how much money investors will lose by swapping the nation’s bonds. That may increase the risk of the euro-area’s first sovereign default.
‘Self-Defeating’
The euro yesterday fell to its weakest in 16 months against the dollar, declining to $1.2665. The yield on Germany’s benchmark 10-year bund fell seven basis points to 1.759 percent after touching a record low on earlier speculation that S&P would maintain the nation’s AAA rating.
Authorities have still to produce “a breakthrough of sufficient size and scope to fully address the euro-zone’s financial problems” and should stump up more resources and show greater flexibility, S&P said. Officials were also chastised for focusing too much on budget cuts which could prove “self defeating” as economic growth slows, it said.
Elevated Costs
The result is that refinancing costs for certain countries may remain “elevated” and credit availability and economic growth may fade, it said. It nevertheless praised the ECB’s decision to lower interest rates and aid banks for helping avert a collapse of market confidence.
Regional finance ministers sought to play down S&P’s shifts or turn them to their advantage as European leaders prepare to meet for the first time this year on Jan. 30.
“It’s not a catastrophe,” French Finance Minister Francois Baroin told France 2 television, noting his country now has the same rating as the U.S.
Wolfgang Schaeuble, his German counterpart, said the moves vindicated the decision by governments last month to bring forward a permanent bailout fund to this year from 2013 and strengthened his country’s determination to stabilize the euro region by instilling stricter budget discipline.
“We know that there’s uncertainty with respect to the euro area,” he told reporters in the northern German port city of Kiel.
Bailout Potency
The French and Austrian downgrades risk sapping the potency of the region’s current rescue program, which has a spending capacity of 440 billion euros ($558 billion). The European Financial Stability Facility, which is funding rescue packages for Greece, Ireland and Portugal partially with bond sales, owes its AAA rating to guarantees from the region’s top-rated nations. It is scheduled to sell up to 1.5 billion euros in 6- month bills next week.
The French downgrade and refusal by governments to provide more credit enhancements would still reduce the fund’s lending capacity by around a third to 293 billion euros, Trevor Cullinan, S&P’s director of sovereign ratings, said last month. It is scheduled to call for bids of up to 1.5 billion euros in 6-month bills on Jan. 16.
John Chambers, managing director of sovereign ratings at S&P, said in a Bloomberg Television interview in New York that the EFSF’s “rating rests on its guarantors, and particularly its triple-A guarantors.”
EFSF Power
“It will be interesting to see what the strategy will be regarding the EFSF,” said David Schnautz, a fixed-income strategist at Commerzbank AG in London. Downgrades could “limit the volume of AAA rated EFSF paper that could be issued, or the EFSF could begin to issue non-AAA.”
Investors ignored S&P last year when it cut the U.S. to AA+ in August as the world's largest provider of credit analysis argued that the failure up to then of Democrats and Republicans to agree on budget cuts made the U.S. less creditworthy. Seven weeks after the downgrade, the yield on the benchmark U.S. government bond fell to a record 1.6714 percent.
Haven
One difference with the France is that the U.S. is prepared to print money, making it easier for the world's largest economy to pay its debts, while the European Central Bank is still refusing to countenance that option.
``The U.S. is still rightly seen as a safe haven,'' said Fredrik Erixon, director of the European Centre for International Political Economy in Brussels. ``The U.S. is a big liquid economy with a strong tradition of honoring its debts in modern time and a central bank pledged to taking action if needed. It’s different with France in the sense that they cannot rely on strong central bank policies.''
The impasse in Greece’s debt-swap talks comes three months since officials and creditors agreed to implement a 50 percent cut in the face value of the country’s debt, with a goal of paring Greek’s borrowings to 120 percent of gross domestic product by 2020. Unresolved is the coupon and maturity of the new bonds to determine the total losses for investors.
Discussions With Greece
Proposals put forward by a committee representing financial firms have “not produced a constructive consolidated response by all parties,” the Washington-based Institute of International Finance said in a statement yesterday. “Discussions with Greece and the official sector are paused for reflection on the benefits of a voluntary approach.”
The government said the two sides will reconvene discussions next week. European governments have been pushing for the Greek debt to carry a coupon of 4 percent, a person with direct knowledge of the negotiations said this week. Private bondholders said they would accept those terms for a period of time if they were able to get a bigger payout later as Greece’s economy recovered, the person said.
The Greek bond due October 2022 rose, pushing the yield six basis points lower to 34.36 percent at 5:20 p.m. London time. The price climbed to about 20.5 percent of face value."
eaustinn36- Master
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Jagdgeschwader- The Unknown Soldier
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Re: US Loses AAA Credit Rating
Super Mega King 15th January 2012, 4:38 am
Jagdgeschwader wrote:^
Woopty doo.
It's sort of a big deal when the world's leading nations are all losing credit ratings.
Super Mega King- Staff
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Re: US Loses AAA Credit Rating
Jagdgeschwader 15th January 2012, 4:39 am
Super Mega King wrote:Jagdgeschwader wrote:^
Woopty doo.
It's sort of a big deal when the world's leading nations are all losing credit ratings.
Not so much when it's down to "AA+".
Oh no, the world is ending. Media is completely detached from regular people.
In short: No, it's not a deal at all.
Oswald Spengler stated 90 years ago that we were in the Winter of Western civilization, and I believe him. I wouldn't be surprised if our Western society partially collapsed in our lifetimes.
Jagdgeschwader- The Unknown Soldier
- Posts : 2455
Re: US Loses AAA Credit Rating
Super Mega King 15th January 2012, 4:51 am
Jagdgeschwader wrote:Super Mega King wrote:Jagdgeschwader wrote:^
Woopty doo.
It's sort of a big deal when the world's leading nations are all losing credit ratings.
Not so much when it's down to "AA+".
Oh no, the world is ending. Media is completely detached from regular people.
In short: No, it's not a deal at all.
Oswald Spengler stated 90 years ago that we were in the Winter of Western civilization, and I believe him. I wouldn't be surprised if our Western society partially collapsed in our lifetimes.
Yes, it is is a deal. It's a slippery slope. It's a foreboding of things to come. An omen.
I don't see how you can take the news that the economic downturn is literally continuing and getting worse with such apathy.
Super Mega King- Staff
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