Obama officials clash with S&P over downgrade threats

[OmahaBlueDog]

Source: Reuters/Yahoo

S&P's latest downgrade warning last week came as time runs short for Congress to raise the federal government's $14.3 trillion borrowing limit. Without a deal by August 2, the government is expected to run out of money to pay its bills and then default, triggering devastating economic consequences.

In telephone calls to top S&P officials, the Obama administration has asked why the ratings agency keeps shortening its timeframe for long-term deficit reduction, according to sources familiar with the discussions.

In October 2010, S&P said it wanted to see a meaningful deal to rein in long-term deficits within three to five years.



Read more: http://news.yahoo.com/obama-officials-clash-p-over-downgrade-threats-200358261.html

[Zenlitened]

1. Further evidence that it was a mistake to tie major debt reduction to raising the debt ceiling.

Just invites all sorts of underhanded behavior.

[robinlynne]

2. yep.

[slipslidingaway]

4. + 1 n/t

[Poll_Blind]

5. +1

PB

[freshwest]

3. They're doing it because they're in bed with these crooks. Financial terrorists.

[proverbialwisdom]

6. I saw the thuggish 24-hr media blitz on MSNBC and the Charlie Rose Show.

And was horrified by the deference shown - not one question on their company's crucial role in the subprime mortgage mess categorizing junk bonds as AAA and leading directly to destroyed pension funds and local government investments.

Obviously, not my field, don't know the jargon, but you get the idea. Sources: INSIDE JOB dvd, PLUNDER dvd, AMERICAN CASINO dvd, All The Devils Are Here (book). multiple articles.

[unkachuck]

7. "...asked why the ratings agency keeps shortening its timeframe..."

....those slimy unelected corporations and capitalists, have our federal government shaking in their boots....not a pretty sight....

[TexDevilDog]

8. Bible says, the borrow is slave to the lender and.........

the federal government has to bend to the slave master (banks) whims.

[QC]

9. Is this the same S&P that put AAA ratings on junk securities,

thus precipitating a worldwide economic meltdown?

That S&P?

Of course, if they had been properly investigated and punished, they would not be able to blackmail us now. So much for looking forward and not backward.

[nolabels]

11. If wouldn't have been for the US bailing out the house of cards they run.........

there probably wouldn't even be a S&P anymore. They know not what they do now, and a hope for them to figure it out too late to save their little greedy selves

[Yo_Mama]

10. If this is true, it's testimony to the administration's blinding incompetence

There's no mystery as to why the rating agencies will downgrade us.

A) Under current law, our government debt is just about 100% of GDP. Most countries do default when they cross that line.
B) We are running a sky-high deficit in terms of percentage of GDP. The administration has submitted two plans this year, neither one of which addressed the problem.
C) We are in the early stages of a recession, which means that our chance of curbing the deficit without law changes are nil.
D) So far, nothing proposed would meaningfully change our probability of default.

You can't ask private entities to lie so politicians can get reelected, and for everyone who will need payments for the government in the future, it's better if the credit ratings firms don't lie.

The US is going to be downgraded several times in the next couple of years regardless. The key to staying at the higher ratings levels will be to change quickly.

So if administration officials really asked S&P why they were doing this, it is proof of either extreme hypocrisy and irresponsibility, or testimony to sheer incompetence.