The Bankwatch

Tracking the consumer evolution of financial services

US debt comes under negative scrutiny by S&P

The forecasts and predictions that Niall Ferguson was making last year are coming home to roost.  This is an early warning shot across the bows of the US lawmakers.  S&P kept the rating at AAA but the door is now open a crack for that to change.  S&P and the other rating agencies looked like Pollyanna lemmings before the credit crisis, so you can bet they will not let that happen again if they can avoid it.

S&P cuts US credit outlook to ‘negative’

“We believe there is a material risk that US policymakers might not reach an agreement on how to address medium- and long-term budgetary challenges by 2013; if an agreement is not reached and meaningful implementation does not begin by then, this would in our view render the US fiscal profile meaningfully weaker than that of peer ‘AAA’ sovereigns,” the rating agency said in a statement.

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Written by Colin Henderson

April 18, 2011 at 10:47

Posted in Uncategorized

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