A few days ago, Standard & Poors downgraded the U.S. credit rating from its perfect AAA grade, to the slightly lower AA+ and suddenly all hell broke loose. Did the sky truly fall, or did we all just overreact?
Once the downgrade was announced, Democrats and Republicans took turns pointing the finger of blame at each other. The stock markets took a tumble and TV analysts spent hours discussing their theories of who and what went wrong.
But yesterday, in the midst of the markets sinking more than 600 points and President Obama taking to the airwaves to assure a skittish public, something incredible happened — international investors found the U.S. to be the safest place to invest their money. Or in short, the credit downgrade didn’t amount to a hill of beans!
AA+ is not some frightfully bad rating. It’s not perfect, but nor does it have to be. Besides, Standard & Poors is not necessarily the end all when it comes to handing out credit ratings. Aside from making an embarrassingly large financial mistake in their evaluation of the U.S. credit standing, Standard & Poors has previously given perfect credit ratings to those who were completely undeserving of it and eventually went under. Or in other words, theirs is not the voice of God.
So on a day when the worst was expected, the sky didn’t fall after all. Or in the words of President Obama: “We are the United States of America and we will continue to survive.”
I agree with you DJ…it's NOT the end of the world.I also agree that in recent years the S&Ps reputation has taken a major hit…and deservedly so for failing to do its job right up to the eve of the economic collapse in 2008. But I'm going to give the S&P a little credit here for actually doing their job THIS time. One can certainly argue Why Now is the S&P concerned about its credibility??? when it had NO problem approving darn near every piece of garbage coming down the pike during 8 yrs of G.Dubya's Presidency. Could it be political? Yes. Possibly.Could the S&P be doing Wall Street's bidding as Wall Street appears to have turned on the President? Yep. That's possible too.But none of those possibilites changes the fact that WE (America) are in BIG trouble. The President recently allowed himself to be played AGAIN by the Repubs. He did NOT stand his ground and they ran him over.… Read more »