Skip to comments.Egan-Jones cuts U.S. rating (based) on debt burden (AA -- now only 3rd highest rating)
Posted on 04/06/2012 9:16:39 AM PDT by xzins
NEW YORK, April 6 (Reuters) - Egan-Jones Ratings downgraded the credit level of the United States as Washington has struggled to reduce the federal debt burden, which is projected to surpass the size of the country's economy.
The independent rating firm, which issued the downgrade late Thursday, said its senior debt rating on the United States is now AA, its third highest rating, down one notch from AA-plus.
It also maintained a negative watch on the world's biggest economy as the federal debt load could rise to $16.7 trillion at the end of 2012. U.S. gross domestic product, in the meantime, could grow to $15.7 trillion, assuming it would grow at a rate of 2.5 percent, the firm said.
The firm downgraded the United States for second time in less than nine months "because of the lack of any tangible progress on addressing the problems and the continued rise in debt to GDP," said Sean Egan, co-founder of firm, in an e-mail statement.
Egan-Jones's downgrade did not elicit major market responses. U.S. government debt prices jumped on Friday after news of much weaker-than-expected job growth in March renewed bets the U.S. central bank would embark on more bond purchases to foster economic growth.
Back in mid-July, Egan-Jones stripped the United States' of its top AAA-rating amid the debt ceiling fight in Washington that stoked fears of a federal default.
(Excerpt) Read more at reuters.com ...
Cue Nelson pointing at obama, “ Ha-haa! “
Spending is beyond saying it's "out of control". Spending is entirely impulse and an addiction for our government....democrat and republican alike.
I can say with the utmost confidence that it is unprecedented and extraordinary for Egan-Jones to reduce our debt rating based on our debt, inability to pass a budget, spendthrift president and spineless Congress.
Doesn’t Egan-Jones understand we have caring and compassionate government overlords.
Guess we’re on our own after all.
Apparently, our non-law professor is also a non-economist.
dictating to us proletarians.
Who is Egan-Jones? Do they matter?
Yes. They were the first to strip the US of its AAA rating last year.
Also, they are one of a limited group of raters recognized by the Securities and Exchange Commission
“Who is Egan-Jones? Do they matter?”
What matters is that they are absolutely correct, and everyone with ANY economic aptitude knows it.
In fact, I would say they are markedly UNDERstating the case for downgrading the USSA.
The real question is whom Bambi has bought off at Moody’s and Fitch in order to keep the AAA rating?
Okay, thanks. Didn’t know who they were.
Some firms get paid for their ratings by investors in their company. Others get paid by the people they rate.
Egan doesn’t get paid by those they are rating, so they have a higher probability of being independent in their thinking.
Debt rating? America only cares about women’s issues.
mmm mmmm mmmm
Obama’s gettin his way.
OF course we’re broke, we’ve been bailing out economies all over the world.
“...as Washington has struggled to reduce the federal debt burden...”
What is Egan-Jones? Have I ever heard of them? I mean, I haven’t.
well crap, guess I’m gonna have to update my tagline..
My view, unlike most folks:
It’s not just Obama’s fault. In fact, the vast majority of USAians think Federal Reserve Notes are perfectly fine pieces of paper. All but one offering for _republican_ presidency think they are great, too. Unfortunately, the one with a clue, is quite a ways off on everything else.
Certainly the _republican_ controlled DC eras, have been fully cooperative in create debt, especially, the kind of debt which is not talked about, like hundreds of trillions of liabilities within the many levels of USG. Certainly, the _republican_ speech therapists concealed the transfer of enormous amounts of USA wealth to foreign nations, continuing unabated.
USA became the land of the banker, financial bundler and vote seller. Private enterprise be crushed, by them and every corporation moving USA manufacturing anywhere but here.
[ NOTE: My statements consist of personal knowledge or ppinions and are not those of my corporation or it’s employees. ]
So THAT'S why Obama is so busy trying to convince the SCOTUS to keep Obamacare. It should completely balance our budget!
see #12 and #13
Comrade BO is proving the economy improved in the early 90’s in spite of clinton.
"Washington" hasn't done a damn thing to reduce the debt. Neither libs nor pubs.
This thinking is a bunch of crap.
Yeah, President DumbA$$’ budget was so awe inspiring!
Yet, 50% of Americans, Dummycrats obviously, approve of this
The government is running the finances of the country via a principal of “willful disregard”.
OBAMA TO MOVE TO
MAFIA, AND NUTASHA
We are in a long-wave contraction. It started before Obama took office. It will continue long after he is gone.
The folks pining for economic salvation at the hands of the Republicans are in for a rude awakening. They can't stop it, either. It's global, it's deadly serious, and the contraction will not stop until the true financial state of the world's economy is revealed.
That being said, Obama, like Bush before him, used all the typical tools to address a "recession." We were not in a "recession." What his crew has done is made our situation WORSE.
Six more years of pain, ladies and gents, at a minimum, no matter who is in office. But for the sake of our country, our values, and our position in the world, we need to definitely vote Obama out.
RACIST! WOMAN-HATER! CHILD-STARVER!
Yeah, and he’s unelected, too, just like the Supremes, who’ve sucked since Gladys Knight got laryngitis. I’m a law professor and I talk in shorthand.
Once the world saw that we might elect a communist Islamo thug, all the pillars started to shake. We had Pelosi in the house, Reid in the Senate. Obama was the signal that America was finally done. Freedom was about to die. The keys to the largest nuke arsenal in the history of man kind handed over to a Muslim from Indonesia.
The world had to acknowledge that we are insane, and we held the worlds trading currency, and all countries were invested in us, the beacon of freedom. We told the world that the system would be fundamentally changed. We would now go full blown communist.
The world listened. They know what communism is better than we do. So the economy started to puke in 2008 with just the thought of Obama, a lawless thug spreading the wealth (stealing and squandering).
You are welcome to disagree. That will not change economic fact. The next President, R or D, will preside over a financial graveyard. Wealth is contracting globally, regardless of who is in the White House or what islamic facists are doing.
The only thing that could have pulled us back from the brink was a drastic slashing and 25% reduction in the world's level of debt back in 2010, plus a 25% reduction in it's future liabilities. The pantywaists running the show on both sides would never agree to it. We are now well past the economic tipping point of 77% debt to GDP ratio, we're in the ZIRP trap, and QE is the only way to keep this flagging ship from going under (which only exacerbates the other two problems).
As for dollar being King, it won't be for much longer. China has been pushing for currency dominance, and until it was revealed that they have been cooking their books, too, were gaining traction. Other countries have already started to de-peg from the dollar to avoid exported inflation.
Chairs, deck, ice chunks.
But how can the “pantywaists running the show” do anything else? The dear people are now very fond of their entitlements - a hefty percentage are dependent on them. No politician could make cuts of that kind of magnitude without alienating enough people to vote him out of office, no matter how imperitive they were to make.
I agree with TheWriterTX.
He may not agree that a real leader, who knew what the real problem was, would end MOOTA and walk us thru the necessary, painful restructuring. Anything else applies a bandage for a short time...
6 OR 7 suitcase nukes going off around the world, would change it all - quick. Martial Law Worldwide.
But honestly, people are scrambling to preserve capital in a era when wealth contraction is inevitable. We have not hit bottom, and folks who think we have are fooling themselves.