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Title: Will S&P Downgrade Be Another Y2K Scare?
Source:
Naked Capitalism
URL Source: http://www.nakedcapitalism.com/2011 ... rade-be-another-y2k-scare.html
Published: Aug 6, 2011
Author: Yves Smith
Post Date: 2011-08-06 09:49:29 by lucysmom
Keywords: Chicken Little, Obama Did It, Pot, Kettle
Views: 41400
Comments: 76
It isn’t yet clear what the impact of the S&P downgrade of the US to AA+ will have. There are good reasons to believe, despite the media hyperventilating, that it won’t add up to much, and may perversely hit wobbly stock markets more than Treasury yields. But there is a much bigger issue, namely S&P’s highly questionable conduct, the lack of any analytical process behind this ratings action, and the political implications. Will the S&P Downgrade Have Much Immediate Impact? Although I run the risk of being proven wrong, there are lots of reasons to think that the reaction in the Treasury market to the news will be underwhelming. We might see some reactions Monday as some investors who managed to be blindsided and aren’t happy with the downgrade exit but conversely, I know of investors who see any price softening as a buying opportunity. Treasury yields fell 50 basis points last week despite the risk of a downgrade being very well telegraphed. S&P had asked for $4 trillion in deficit reductions (it tried disavowing that number) and made it clear it was going off to brood and might take action. And this market response took place with S&P leaking like a sieve. Poster Comment: What was the S&Ps role in the mortgage crisis?
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Begin Trace Mode for Comment # 67.
#1. To: Badeye, A K A Stone, hondo68, Fred Mertz, Godwinson, go65, war, no gnu taxes, Skip Intro, ferret mike, jwpegler, brian s, mcgowanjm, Capitalist Eric, Mininggold (#0)
Inflation is over. From Nixon's Gold Default to May 2005....that was inflation. It's Deflation now, as everyone goes to cash...;}
Think $100 per acre for Prime Farmland.
And then $50.
And then $50. I suppose that translates into a 50% cut in food prices as well.
Remember gasoline for a $1? It'll be a $ again. Except that the avg yearly salary will be $7500. And you'll be growing your own food, btw....;}
Why? Why should deflation remove the capitalist impulse to provide for oneself by providing for others?
It takes money. Will you have it? Not credit. And definitely No Debt. Actual Linen Dead Presidents. Or you're a slave. And the Capitalist 'Impulse' is to Oligarchy/Monopoly/ Kleptocracy/Plutarchy....the Top 50 000 owning the Top 60%.
No kidding McGoo...why do you assume no one besides yourself has any?
No kidding McGoo...why do you assume no one besides yourself has any? Yeah Shitbird weighs in. Don't call me names....just sayin...;} Becuase it's NOT an Assumption. The Bottom 90% are tapped out! What part of Since Nixon & 1974 and then Reagan Stagnant wages, $1.5 Quadrillion in Debt derivatives are you NOT getting? 8D
What part of Since Nixon & 1974 and then Reagan Stagnant wages, $1.5 Quadrillion in Debt derivatives are you NOT getting? Maybe you should focus a little harder on the plain fact that not everyone has spent the last 40 years engaged in irrational exurberance.
BUWAHAHAHAHAHAHA which greenspan started. Sweet baby hesus...the criminal prescribes the anit dote.... insane...8D
You can see the problem on cnbs and the NYSE floor. The gnomes are standing on the floor like they have no problems and are in control. The problem is that they can't hold more paper. Someone was up ALL night putting their 'Assignments' together.... LMFAO The Center cannot hold...
How's that War for the Jews comin'. You guys gonna wrap that thing up anytime soon? Cause we need the $$$...8D
One fifth of Congress is over there on Summer break. I believe they all got a deal they couldn't turn down. It's okay, the Bible thumpers here will make excuses.
Like Reagan going to Japan...;}
We've got to keep Big Pharma happy.
Again?!
And they have the nerve to say he's not pro Israel!
The Greatest Ponzi in World History was revealed yesterday. We're now in real time break down. Reichstag fires and wars are all they have left.
There are no replies to Comment # 67. End Trace Mode for Comment # 67.
Top • Page Up • Full Thread • Page Down • Bottom/LatestA country that controls its currency can always satisfy the IOUs it creates. The risk is inflation, not default. But ratings agencies assess credit ratings, not interest rate risk.
#2. To: lucysmom (#1)
The risk is inflation, not default. But ratings agencies assess credit ratings, not interest rate risk.
#3. To: All (#2)
(Edited)
#4. To: All (#3)
#5. To: mcgowanjm (#4)
Think $100 per acre for Prime Farmland.
#6. To: Thunderbird (#5)
I suppose that translates into a 50% cut in food prices as well.
#7. To: mcgowanjm (#6)
And you'll be growing your own food, btw....;}
#22. To: Thunderbird (#7)
Why should deflation remove the capitalist impulse to provide for oneself by providing for others?
#33. To: mcgowanjm (#22)
It takes money.
#37. To: Thunderbird (#33)
It takes money.
#41. To: mcgowanjm (#37)
#51. To: Thunderbird (#41)
Maybe you should focus a little harder on the plain fact that not everyone has spent the last 40 years engaged in irrational exurberance.
#52. To: All (#51)
#53. To: All (#52)
#58. To: mcgowanjm (#53)
(Edited)
How's that War for the Jews comin'.
#59. To: mininggold (#58)
#62. To: mcgowanjm (#59)
Like Reagan going to Japan...;}
#63. To: mininggold (#62)
We've got to keep Big Pharma happy.
#65. To: socalv8 (#63)
Again?!
#67. To: mininggold (#65)
Replies to Comment # 67.
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