Moody's warned on Monday that it could move a step closer to cutting the U.S. Aaa rating if President Barack Obama's tax and unemployment benefit package becomes law.The plan agreed to by President Barack Obama and Republican leaders last week could push up debt levels, increasing the likelihood of a negative outlook on the United States rating in the coming two years, the ratings agency said.
A negative outlook, if adopted, would make a rating cut more likely over the following 12-to-18 months.
For the United States, a loss of the top Aaa rating, reduce the appeal of U.S. Treasuries, which currently rank as among the world's safest investments.
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3 comments:
Is there even a point in propagating this stuff? Moody's (1) isn't exactly credible, and (2) always seems to be fashionably late with ratings updates.
Last week, the same guy, working for the same agency, made the exact opposite prediction: http://fdlaction.firedoglake.com/2010/12/13/moodys-swings/
Moody's was once a reputable firm and is now a toilet full of marketers and pundits trying to milk every last drop of the reputation built up by the analysts they got rid of years ago. This is either a political ploy or a laughable attempt at salvaging their reputation (which is all they really have to sell in the first place). Probably both -- a sad case of a bunch of Fox nuts believing their own propaganda. Ergo, if they trash the government they think they can regain credibility so they can go back to selling opinions.
I'll admit I'm only speculating as to their motive, with a dash of personal bitterness. However, their lack of credibility is objectively well-documented. They were even hauled into court for their role in the financial crisis, and they could not deny they said the outrageous things they said, so they got away by calling their BS protected speech.
We're all aware of what Moody's WAS, but this is now. I thought this blog was about data and facts. Please do not give a thoroughly discredited and highly agenda-driven outfit like Moody's any credibility, especially without any follow-up comment on the nature of the source. Moody's damaged its own reptutation; you shouldn't let it damage yours.
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