Just in case you thought Moody’s knew anything about sovereign debt.

And how about those Democrats are using deficit terrorist rhetoric to try to fight back against the Republicans.

*DJ Moody’s Says US Sovereign Debt Rating Stable For Now
*DJ Moody’s:US Sovereign Debt Rating Stable Following Tax-Cuts Decision
*DJ Moody’s:US Rating Could Be Negatively Affected Over Longer Term By Tax-Cut Extension

DJ Moody’s Says US Sovereign-Debt Rating Stable For Now
12/07/10 12:51

NEW YORK (Dow Jones)–Moody’s Investors Service said Tuesday that the United States’ top sovereign-debt rating is stable for now, but could be negatively affected by the extension of tax cuts and if the government can’t get its growing debt under control.

Moody’s senior credit officer Steven Hess said the country’s stable outlook wouldn’t be affected by Monday’s deal to extend current tax rates for two years, reduce the payroll tax for a year, and extend unemployment benefits.

He was speaking in a telephone interview with Dow Jones Newswires Tuesday.
Moody’s rates the debt of the world’s biggest economy at Aaa, its highest rating. The stable outlook means that rating is unlikely to be changed in the next one to two years.

However, Hess said the country’s outlook could worsen if the tax cuts are extended further and no other measures, such as spending cuts, are taken to get the ballooning deficit under control.

If the current tax cuts are extended again, “clearly that makes the long-term outlook more negative” for the U.S. rating, Hess said.

6 Responses

  1. Hey, the Flat Earth Society says Canada’s earth is flatter than Bhutan’s, so why not apply the same logic to currency?

    Users consider an issuers ability to issue, based on the advice of known frauds who don’t know the difference? Doesn’t get any better this side of a good rabbit hole, or drugs of your choice.

  2. Warren, I read your bio at the end of “7 Deadly Frauds,” specifically, the trade involving JGBs (or was it Italian bonds?) where your counterparty went bust betting on some sort of default which never came to be. I realized that you brilliantly bankrupted all sorts of bond traders who didn’t understand the very risk they were betting on. They must have taken the Moody’s rating to the bank (or poorhouse.) That is pretty awesome.

    Off topic, but you bear a striking resemblance to Joe Turkel in Blade Runner. Check this out: http://ia.media-imdb.com/images/M/MV5BMTY2ODU5NjEzN15BMl5BanBnXkFtZTcwNjQ3NDU4Mw@@._V1._SX640_SY988_.jpg

  3. Are these the same guy’s that rated the AAA tranches of CLO’s and “Synthetic CDO’s”? They are like Bernanke and others…as long as people give them any credibility, they will continue to think they know what they are talking about!

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