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A major rating agency downgraded the city of Chicago's creditworthiness two notches to junk status, a move likely to increase the city's borrowing costs and make investors skittish as the financial world reacts to last week's Illinois Supreme Court ruling that bodes ill for city efforts to resolve its massive pension fund shortfall. Moody's Investors Service downgraded the city's debt rating on bond issues backed by property, sales and fuel tax revenue to Ba1, one notch below investment grade, from Baa2, specifically citing last week's Supreme Court ruling on an attempt to cut state pension costs. Moody's calls the Ba1...

S&P cuts Italy sovereign rating to BBB-, just above junk ROME Fri Dec 5, 2014 1:32pm EST Dec 5 (Reuters) - Standard & Poors on Friday cut Italy's sovereign credit rating from BBB to BBB-, just one notch above junk, citing the country's weak growth and poor competitiveness which undermine the sustainability of its huge public debt.

If the Obama administration used federal prosecutors to exact vengeance on Standard and Poor’s for downgrading the rating of federal debt, that would be a serious crime, an impeachable offense if it could be traced to the Attorney General or the President (not that anyone other than Democrats is interested in impeachment).  It would be evidence of thug government, where the rule of law has been replaced with the law of the jungle, using prosecutorial power as an instrument of political intimidation, as in Travis County, Texas. That’s why a recent court filing by Standard and Poor’s may lead to...

highlights of Harrington's story below. Here are some key points: Moody's ratings often do not reflect its analysts' private conclusions. Instead, rating committees privately conclude that certain securities deserve certain ratings--but then vote with management to give the securities the higher ratings that issuer clients want. Moody's management and "compliance" officers do everything possible to make issuer clients happy--and they view analysts who do not do the same as "troublesome." Management employs a variety of tactics to transform these troublesome analysts into "pliant corporate citizens" who have Moody's best interests at heart. Moody's product managers participate in--and vote on--ratings decisions....

Does the Fitch rating make you feel better about the economy? You betcha. Fitch based its decision on facts, S&P was playing politics. Sort of. The reaction to S&P's decision made me nervous about the future. No. S&P's decision shook up the financial world and the damage has been done. I don't understand these ratings and what they mean. Who are these people, anyway? Other (post a comment)

“The storm has passed!”“Disaster has been averted!”Don’t you feel better? Of the various flavors of Armageddon being pitched over the last month or more, one of the most dire was the threat that the Big Three credit ratings agencies would downgrade our super-duper triple A status unless we got our fiscal house in order. Investors would be jittery and demand a better deal prior to purchasing any of America’s shabby paper.So with the latest version of the new, new deal nearly inked, we’ve at least dodged that bullet, right? Not so fast, says the CEO of PIMCO. One of the...

There have been increasing concerns about the fate of United States' prized triple-A sovereign debt rating. While Standard and Poor's recently downgraded its U.S. debt outlook to negative from stable, implying that a ratings cut could happen in two years, one independent ratings agency has given the U.S. sovereign rating a "C". "A 'C' is equivalent to approximately a triple-B on the S&P, Moody's and Fitch scales. It's two notches above junk and one notch above the equivalent of a single A," Martin Weiss, President of Weiss Ratings, told CNBC Tuesday.

The recent decision by Standard & Poor's to reduce the forecast of their rating of U.S. debt has forced a reevaluation of all the candidates for President now jockeying for position in the Republican field. I am well aware that Governor Chris Christie has been encouraged to consider running for President of the United States, and he has been consistent, admirably consistent in fact, in stating that he will not run. He has said that he feels an obligation to New Jersey voters to fulfill the term of office to which he was elected, and to do what he thinks...

The U.S. government needs to elaborate a credible plan to address its soaring debt in order to maintain its Aaa credit rating, Moody's Investors Service's told Dow Jones newswire.

If there is one thing the rating agencies can be proud of, it is... well, there isn't one. And if after yesterday's mindboggling budget proposal which sees the deficit increasing to $9 trillion in 10 years, coupled with the fact that GSE liabilities now should be counted as part of overall US obligations, neither S&P nor Moody's could muster enough courage to at least put the US on even the weakest form of downgrade review, one can say that after 2 years of pretending otherwise, both rating agencies are still as [clueless/corrupt] as always. Then one barely visible silver lining,...

SAN FRANCISCO (Reuters) – Standard & Poor's cut California's main debt rating on Wednesday by one notch, saying the government of the most populous U.S. state could nearly run out of cash in March -- and another rating cut might follow. The state government's nearly $20 billion budget gap over the next year and a half leaves it in a precarious situation, requiring tax increases or spending cuts, either of which may slow economic recovery, the agency said. "If economic or revenue trends substantially falter, we could lower the state rating during the next six to 12 months," S&P said...

California, tied with Louisiana for the lowest credit rating among the states, now is in more danger of claiming rock-bottom all for itself. Moody’s Investors Service today warned that it might downgrade California’s general obligation bond rating, currently A1, because of the state’s "significant budgetary shortfall, impending liquidity crisis, and lack of legislative solutions." Louisiana also is rated A1. All other states are rated higher on Moody’s scale, typically AA or AAA. Moody’s shift follows a similar warning on California’s debt rating by its rival, Standard & Poor’s, on Dec. 11. S&P also has California tied with Louisiana for last...

<p>Sacramento -- A second major Wall Street rating agency downgraded California's credit on Monday, but not as severely as the hit the state took two weeks ago.</p> <p>Moody's dropped its rating on California's general obligation debt a single notch, from A2 to A3, keeping the rating in the uppermost tier. Standard & Poors downgraded California three notches on July 24, dropping it into the "B" category.</p>