S&P

  • 09 Aug 2011 at 12:51 PM

Did Tim Geithner Acquire A Small Airplane? Update: Nope!

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The Observer reports that “someone paid for an airplane to fly by the New York City offices of Standard & Poor’s with a banner screaming: “THANKS FOR THE DOWNGRADE. YOU SHOULD ALL BE FIRED.”"

UpdateActually it turns out that the person who hired the plane has no problem with S&P and meant to say “YOU SHOULD ALL BE FIRED” to someone else. Oops!

Fortune has learned that the person who paid to fly the banner is a Midwestern broker, who woke up last night with the need to vent at those who she believes are leading the nation into an economic morass.

“I originally wanted to fly it over Washington, D.C., but learned that you can’t do that,” says the banker, who asked to remain anonymous for job security reasons. “So I chose Wall Street instead, but didn’t specifically intend it to fly over S&P. I’m just a mother from St. Louis who feels the only reason we got downgraded was people in politics.”

About that plane over S&P [Fortune]

  • 08 Aug 2011 at 11:52 AM

Nothing Will Ever Be AAA Again

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We assume that you, like everyone else, have been madly dumping Treasuries now that S&P has downgraded them. Smart! And presumably in your flight to safety you’ve been buying AAA rated corporate bonds, from let’s say XOM or MSFT. Which are obviously safer than Treasuries because, while sure the U.S. Treasury can print dollars and Microsoft and Exxon can’t, Microsoft can always send out a secret electronic signal that makes your Windows crash 100% of the time instead of the steady-state 20%, which will force you to upgrade to the next version, which is pretty much the next best thing to printing money. And if XOM is short on cash it can just start a war in the Middle East (that’s how it works right?).

So you think you’re in pretty good shape right? Not so fast – your shit is still really AA+.

The problem is that S&P this morning downgraded Depository Trust Company to AA+ in sympathy with the sovereign downgrade:
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  • 01 Aug 2011 at 7:24 PM

Somebody Wants To Get To Know S&P A Little Better

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Standard & Poor’s has had a few hiccups recently, locking themselves into pointlessly downgrading U.S. Treasuries, pissing off Jean-Claude Trichet, and blowing up the CMBS market revival because they realized too late that they’d forgotten to carry a two.

But Jana Partners and Ontario Teachers’ think of these things not as problems but as opportunities for growth. Or, at least, they seem to think that future growth is going to come less from teaching children how to read and do math, and more from rating sovereign bonds issued by children who can’t read or do math.
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  • 21 Jul 2011 at 6:12 PM

S&P Is Half Serious About Downgrading The US

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They’ll say it again: Continue reading »

  • 15 Jul 2011 at 4:07 PM

S&P Prepared To Downgrade Anything With Two Legs And A Pulse*

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Standard & Poor’s Friday put a broad range of financial firms on negative credit watch, warning they could all be downgraded if the United States has its credit rating cut. The S&P action takes in Fannie Mae, Freddie Mac, all “AAA”-rated insurers, clearinghouses, fixed-income and exchange-traded funds and hedge funds, some Federal Home Loan Banks and Farm Credit System Banks, among others. S&P characterized its targets as “entities with direct links to, or reliance on, the federal government.” [Reuters]

*Not actually necessary. Corpses are also on notice.

  • 14 Jul 2011 at 1:49 PM

Credit Ratings Agencies May Want to Tread Carefully

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It turns out that when you say things like “let’s not pay back our debts, what’s the worst thing that can happen?,” one thing that does happen is that the credit ratings agencies start worrying that you might not pay back your debts. Weird. From Reuters:

Standard & Poor’s has warned lawmakers privately that it would downgrade the country’s debt if the Treasury Department is forced to prioritize payments because Congress does not raise the debt limit, a congressional aide said on Thursday.

That is, cutting off Social Security checks could avoid a technical default but not a downgrade. Moody’s yesterday threw out its own threat of pre-default downgrade.

You know who else had ratings agencies all up in their shit threatening downgrades just because of massive fiscal and political-will problems? Europe. And they have some ideas on how to deal. Short version: insert fingers in ears, close eyes, hum noisily. Longer version:
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  • 15 Dec 2010 at 4:28 PM

New Year’s Resolution For S&P To Consider: Properly Rate A Security For The First Time

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Just one, not all. Start small. Continue reading »