Even After Passing Debt Bill Obama Administration Braces for S&P Downgrade
- Posted on August 5, 2011 at 6:13pm by
Tiffany Gabbay
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Back in mid-July The Blaze reported that Standard & Poor’s was placing the U.S. on its negative CreditWatch monitoring system with the likelihood it would downgrade the nation’s credit rating within 90 days. The reason, according to S&P, was that a failure of the government. to raise the nation’s debt ceiling would increase the risk of a potential government-default. For S&P, more risk means less creditworthiness. But now that a debt bill has finally been agreed to and signed into law, S&P might still seek to downgrade the nation’s credit rating from AAA to AA+ or AA, and the Obama administration is reportedly even prepared for such an event.
ABC reports:
A government official tells ABC News that the federal government is expecting and preparing for bond rating agency Standard & Poor’s to downgrade the rating of US debt from its current AAA value.
Officials’ reasons given will be the political confusion surrounding the process of raising the debt ceiling, and lack of confidence that the political system will be able to agree to more deficit reduction. A source says Republicans saying that they refuse to accept any tax increases as part of a larger deal will be part of the reason cited.
The official was unsure if the bond rating would be AA+ or AA.
Another government official confirms the Obama administration is preparing for the downgrade but is not 100% positive it’s going to happen, and if it does happen officials are not sure when it will happen.
However, The Blaze’s previous report on negative CreditWatch states:
S&P reportedly believes continued delays in raising the debt ceiling could lead the agency to conclude that a U.S. default is “more possible” than “previously thought.”
However, the agency says that if congress and the administration “agree to raise the debt ceiling” it will try to review the details of the agreement within the next 90 days to “determine” whether it is “sufficient to stabilize” the U.S.’ medium-term debt dynamics.
While nothing is definitive yet, if S&P wanted the U.S. to raise its debt ceiling with a view to preserving the nation’s current credit rating, then why would officials now cite Republican opposition to raising taxes as a reason for the pending downgrade?
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Comments (141)
ChiefGeorge
Posted on August 5, 2011 at 6:43pmGo figure? You elect a boy to do a mans job and you get these kinds of results. This man child is an utter failure and he lives up to our expectations. When it comes to actual hardwork, determination to do what is right he fails every time because he is an idealog. He doesn’t know what it means to gut things out, organize, lead or even understand the gravity of his own actions. He is an utter failure through and through. I would fire him, transfer him, do what ever it would take to get him out of my sight if he was in my Navy. He is a trouble maker who never puts forward any real solutions, takes credit for others work and then shirks responsibility when things go bad. He is an excuse maker, will not look inward to see his own faults and short falls but see’s them everywhere else he looks. He makes me sick. I cannot wait til this man is clear of our greatest office but I am still sticking to my guns that he will surely be re-elected despite all I have written. He is quickly becoming the underdog and you know what that means. He‘ll be the come back kid in short order and if the econ truly does collapse he’ll just declare martial law and there will be no elections. Just watch.
Report Post »old white guy
Posted on August 5, 2011 at 6:48pmjeez, everyone with a brain knows that it’s the debt stupid. s&p didn’t get enough from the big o???
Report Post »SavingtheRepublic.com
Posted on August 5, 2011 at 7:00pm^____^____^
WELL SAID! Some of you guys are taking the words right out of my mouth the last cpl days. BUT you left something out, when this happens Emperor Obama will blame Bush, the republicants, TEA Party, Japanese Tsunami, Europe etc etc. He has demonstrated time and again to NEVER take responsibility for his actions and the worst part about it, the zombie drones listen to him and think he is still a god! I heard them spewing typical talking points last night. You would think after 2.5yrs of the JOKE they would wake up!
That is why I too have said he could make it through the ‘12 election with a 2nd term. There are that many blind, uneducated, uninformed zombie dolts who will vote for him b/c “he cant get done in 4yrs”! They are already making excuses about how he was bullied with the debt ceiling. With the coming downgrade do not be surprised to hear/see the same excuses from every corner of this country. They are organized and prepared to point the finger of blame at conservatives! http://SavingtheRepublic.com
Report Post »zazueblue64
Posted on August 5, 2011 at 7:43pmyou are right on most of what you said, but that porknoid won’t be relelected
Report Post »progressives-are-retards
Posted on August 5, 2011 at 7:47pmYou called him “boy.” That’s racist.
Report Post »progressives-are-retards
Posted on August 5, 2011 at 7:49pmFor all you government educated fools, that was sarcasm.
Report Post »robert
Posted on August 5, 2011 at 7:51pmThis country economically is close to depression levels. Many experts are saying the reason Moody‘s didn’t downgrade the US rating was based strictly in politics. That appears to be the case, since debt has now reached the same level as the total of GDP, and the economy is limping along on borrowing and quantatative easing, plus the budget every year now is greater than revenue, adding to the overall debt.
Can you imagine running a business wherein your expenditures FAR EXCEED your income and that you’re required to use your credit card to pay expenses, with every indication the disparity between income and liabilities will only grow larger in the foreseeable future?
That’s where we are at right now. The self-appointed elites are gambling on the come. They’re betting future revenue will be great enough to cover expenditures eventually with the probability that there will be enough to pay down the debt acquired, which has now reached 17 trillion dollars, with an addition to it every year of about 1-1/2 trillion.
People right now are stealing everything they can get their hands on, with some being electrocuted cutting live wires for the copper. We have a population of 12 million illegal aliens that will soon be out of work, along with many citizens. Couple that situation with the black flash mob thefts and attacks that are sure to increase, and we have the potential for large scale crime on an unprecedented level.
Unfortunately, our future looks grim.
Report Post »John 1776
Posted on August 5, 2011 at 8:00pmHauser’s law ( http://en.wikipedia.org/wiki/Hauser%27s_law ) clearly shows that raising taxes would do nothing to increase revenue. You need to grow the pie (GDP) by encouraging small business.
Report Post »Ruler4You
Posted on August 5, 2011 at 8:10pmS&P and/or Moodys both indicated that the “deal” before the Congress would have little or NO impact on their consideration to lower our ‘credit’ rating. That‘s because the ’legislation had little (very little) real economic fiscal responsibility in it. All it did was allow the Congress to continue to fund and spend as it has planned to.
We will be down graded. There is no way to avoid it. But, now that Congress has recessed this becomes a less of a concern. Nothing would be done anyway. America is going to falter and there is no stopping it. The idea now, is to ensure we hit something really hard, so we don’t revive it. A global currency is the goal.
Report Post »gypsy639
Posted on August 5, 2011 at 8:22pmChiefGeorge, the part about him declaring marshall law is a given. He didn’t set up his Civilian Security Force maned by new black panthers, acorn, americorps, student loan students apollo alliance, seiu, afl-cio and millions of others for parades on the 4th of July. They are in place and trained and funded quite nicely. Look in the Obamacare Law. The funding is in place. and being spent for the training. I’m sure the purpose is one thing only, quell any citizen “unrest”. The part about him not being too smart. That’s a mistake almost everyone seems to be making. He is brilliant. Every action and the results of that action have been thoroughly vetted and reviewed to know the precise result they are achieving is what they want and expect.
There is no return from tyranny. I’m old (75) so I don’t have to live in Obama and Soros” new world order. I can only hope the Real Americans can take up arms, if they haven’t a;; been confiscated, and take our nation back as our fore fathers did.
Report Post »Bible Quotin' Science Fearin' Conservative American
Posted on August 5, 2011 at 8:28pmIncredible that the Tea Party takes no blame. The self-richeous rarely do. You come into congress with your minority reps and you act like you’re the only real americans and only what you want should be taken seriously and you expect to get 100% of your demands. Make no mistake. The Tea Party will shoulder the blame for this crippling blow to our economy.
Report Post »easyed598
Posted on August 5, 2011 at 8:35pmIf Obama gets reelected the people of this country deserves what will happen. Multiply by 10 what is happening to Greece. We would have been better off having Joe the Plumber as President. At least he knew economics better.
Report Post »Dinkiecb
Posted on August 5, 2011 at 9:06pmEverybody knows it’s the debt except washington dc .. congress…senate, obamama and all his flunkies
Report Post »flrick
Posted on August 5, 2011 at 9:10pmWell, the libs have been bragging about zero’s “historic” presidency. Now they finally got what they wanted. He presides over the FIRST downgrade in American history!!!! That’s HISTORIC all right! Now can we impeach the boob and find somebody that knows what to do?
Report Post »4truth2all
Posted on August 6, 2011 at 1:22amYou are exactly right; this man is capable of subverting our political process. At every turn there seems more problems or a least the possibilities of them. Like being surrounded by wolves.
Report Post »4truth2all
Posted on August 6, 2011 at 2:00amTo Bible quotin‘ science fearin’ conservative American: 2+2=4 does this answer make me self righteous because I refuse to admit it’s wrong? Have you read what S&P said. If you have you would then know that this is very similar to the reasoning of what the tea party was saying. The downgrade is because the bill passed did nothing to solve the problem. S&P and the dow jones know this. This is actually very simple to explain…2+2=4-3+5 That is what was just done. As you can see by the SIMPLE math it does not work. Maybe you are the one that is being self righteous or even worse, just plain hateful. Oh, and by the way; I do like the truth and I have no fear of science, call me a convervative if you wish ( though I don’t like being classified), and I thank the writer of that truth that I’m an American. Keeping that where it belongs.
Report Post »spreadcommonsensenot pc
Posted on August 5, 2011 at 6:40pmProgressives G2H………………
Report Post »Blitz
Posted on August 5, 2011 at 6:39pmWhen they blame Bush or the GOP it’s admitting they hired the wrong guy. Send the village idiot back to Chicago.
Report Post »cloudsofwar
Posted on August 5, 2011 at 6:50pmchicago? you mean Kenya.
Report Post »avenger
Posted on August 5, 2011 at 7:44pmtoo late..Guns,Ammo,Gold and food storage.this is not going to end well…
Report Post »mr.goodvibe
Posted on August 5, 2011 at 6:39pmIt is going to be both Bushes and Reagans faults. They had something to do with debt also but Obama beet the snot out of there debt levels. Even all three added up dont touch Obama. The progs are right Obama is the best ever!
Report Post »GlennNut
Posted on August 5, 2011 at 6:45pmDo you follow the Fox News propaganda regime’s tactic, learned from Goebbels, of the Big Lie? This is absolute 100% nonsense. Otherwise, how you expect to be taken seriously by anyone?
Report Post »seeker9
Posted on August 5, 2011 at 7:12pmglennut
You mispoke. It is MSNBC tat is the propaganda machine.
Report Post »Snowleopard {gallery of cat folks}
Posted on August 5, 2011 at 7:14pm@GlennNUT — return to the same swamps you and your master Lord Soros have emerged from.
Report Post »Servant Of YHVH
Posted on August 5, 2011 at 7:49pm@GlennNut
Report Post »Good post. You have the libs thinking that you’re on their side, in fact you almost made me believe it. Just keep remembering that the Tea Party loves ALL it’s members including the Tea Party members that are undercover in the closet. Keep up the good work.(wink wink)
Dinkiecb
Posted on August 5, 2011 at 9:05pmDrugs are bad for ya … to much Obama drug…
Report Post »uncensoredTalmud
Posted on August 5, 2011 at 6:39pmNow that we have looted the economy, it is time for a massive false-flag so we can collapse the dollar and get out of paying our obligations, while at the same time starting a war with Iran & Pakistan.
But I don’t feel sorry for any of you goyim. I only feel sorry for fellow jews, such as Madoff’s victims.
Then again, Madoff simply did these jews a favor by taking their money out of the country tax-free right before the 2008 collapse.
Report Post »tower7femacamp
Posted on August 5, 2011 at 7:36pmA funny thing recently happened at the Italian-Swiss border. Italian authorities found a briefcase filled with $134.5 billion in U.S. government bonds. While this now appears to be merely a massive counterfeiting case, initial worries were that a major nation clandestinely attempted to unload a staggering sum of genuine U.S. dollar securities.
Report Post »On June 3, Italy’s Guardia di Finanza (Financial Police) arrested two Japanese men in their 50s. They were apprehended in Ponte Chiasso, a frontier town about 25 miles from Milan. Rather than travel express to Switzerland, these suspects were on a local northbound train where they stood out among working-class Italians.
When quizzed, the Guardia say, the two men claimed they had nothing to declare. Authorities inspected a briefcase they carried. Beneath a false bottom, it featured a secret compartment that primarily concealed 249 U.S. bearer bonds, each with a $500 million face value. Several smaller financial instruments brought the haul to $134.5 billion.
Officials were particularly intrigued; Italian law lets the government seize 40 percent of the bonds’ value exceeding the 10,000 euros ($13,952) that may cross borders without disclosure. This would have been a $53.8 billion bonanza, equal to 10.3 percent of Italy’s $521 billion 2009 budget.
These bonds were not obvious forgeries. For nearly two weeks, Italian authorities probed their authenticity and eventually requested the U.S. Securities and Exchange Commission’s appraisa
Drakkhanlord
Posted on August 5, 2011 at 6:38pmwatching cspan3
Drinking water Safety…EPA…fun stuff in water…
Report Post »mattmo79
Posted on August 5, 2011 at 6:37pmCheck out your history, revenue ALWAYS goes up as a result of lower taxes not the reverse. It‘s pretty simple and you don’t need to have a Nobel Economics award to understand that a strong vibrant economy with solid job growth brings in more revenue.
Report Post »rickroland
Posted on August 5, 2011 at 6:36pmLike this is a shock? Considering that the debt ceiling deal that was signed into law cuts NO spending at all, it just decreases planned INCREASES! Washington D.C. will be the economic death of this country in few short years if drastic (even horrific) cuts are not made in out-of-control Federal government spending.
Report Post »thinkinghuman
Posted on August 5, 2011 at 6:34pmThose politicians and their DEBT. They did nothing of substance in all of this posturing, and now the banks are going to stick it to them, because their DEBT is still out of control. It really is.
What a sham
Report Post »Mtroom
Posted on August 5, 2011 at 6:33pmSo it’s not the out-of-control spending.it’s not raising taxes that has them lowering our credit rating?
Report Post »Oh, and it‘s all Bush’s fault
USMarine0311
Posted on August 5, 2011 at 6:33pmAnyone here shocked, I’m not.
Report Post »heyjms
Posted on August 5, 2011 at 6:31pmJust like Pres. Obaby to cry about Republicans, Tea Party and everyone else to blame. He GENIUS, its your fault! It’s time you pack up your crayons and let the adults handle things.
Report Post »Dinkiecb
Posted on August 5, 2011 at 6:31pmSo what’s the excuse for waiting to downgrade again??? Congress and the administration are to stupid to realize you can’t keep this high spending spree…and with masive unemployment whos got the money for more taxes??
Report Post »GlennNut
Posted on August 5, 2011 at 6:40pmUm… The rich. Duh.
Report Post »Dinkiecb
Posted on August 5, 2011 at 9:09pmAnd how long are the rich gonna be rich with them payin all their money? And who’s rich .. who is this guy Rich anyway…he sure gets around but never see em
Report Post »Yogurt
Posted on August 5, 2011 at 6:28pmRon Paul tried to tell them…
Report Post »Mrtoohappy
Posted on August 5, 2011 at 6:38pmHell they are already blamimg the Republicans. We need to let this happen and what ever else to stop these guys from borrowing and spending money. Maybe we should of defaulted. Then we could start all over again and vote them all out at the sametime.
Report Post »hogtrashhd
Posted on August 5, 2011 at 6:28pmI’d have to say at this point.. he’s not expecting it.. he’s hoping for it …. and there’s your hope and change…destruction at whatever the cost.. hey, let’s get in his conga line… bam bam bam bam bam yeah.. now we’re having fun.. it’s all within sight now.. suckers..
Report Post »Lesterp
Posted on August 5, 2011 at 6:39pmThat was my first thought and I’m sticking with it!
Report Post »VanGrungy
Posted on August 5, 2011 at 6:27pmWhat makes anyone think the ratings agencies are any less controlled than the fed reserve?
Report Post »LadyIzShy
Posted on August 5, 2011 at 6:27pm” A source says Republicans saying that they refuse to accept any tax increases as part of a larger deal will be part of the reason cited.”
oh sure blame the GOP for refusing to steal more money from Americans why not blame those who are SPENDING MORE MONEY THAN THEY TAKE IN VIA TAXES.
Report Post »NHwinter
Posted on August 5, 2011 at 6:26pmBe sure to blame the Republicans for the downgrade, not the excessive spending of the President and the Democrats. Get ready for more talk of terrorist, hostage takers, etc., etc. And, please, never take responsibility for your administration’s mishandling of the economy, the failed stimulus, the bailouts. I’m so weary of the Democrats. Come on Republicans, give them back what they dish out. They are Jhadist of our Republic.
Report Post »NOBALONEY
Posted on August 5, 2011 at 6:26pmAll the reports of coming downgrades came after the close of the stock market. This is more double-dealing, and leading investers in all directions. I believe the MSM purposely withheld this information, because of what it would have done to the markets today.
Report Post »LadyIzShy
Posted on August 5, 2011 at 6:45pmtoo bad I sold what I could. I didnt touch the 401K because of the penalties but the others I sold, should have sold a month ago but I was hoping I was wrong
Report Post »Rickfromillinois
Posted on August 5, 2011 at 6:26pmI thought that one of the conditions that they were calling for was at least 4 trillion dollars in cuts.
Report Post »simplygilly
Posted on August 5, 2011 at 6:25pmRepublicans refusal for tax increases or Democratic refusal to impart some level of taxation on the 1/2 of the country that pays none?
Report Post »sopourn
Posted on August 5, 2011 at 6:25pmthe construction market is going to go into a screeching halt.
Report Post »USA-CONSERVATIVE
Posted on August 5, 2011 at 6:54pm@sopourn It already has
Report Post »13th Imam
Posted on August 5, 2011 at 7:07pmNot in DC. DC is booming, Craploads of Americas Actual Taxpayers Money there
Report Post »oldchevyguy
Posted on August 5, 2011 at 6:24pmSounds to me that S&P is a little too cozy with the Obama Administration.Bought and paid for!
Report Post »Jus-sayin
Posted on August 5, 2011 at 6:27pmIt‘s either Bush’s fault or the republicans. These guys can‘t see the forest for the tree’s. Hold on, we’re going for a ride.
Report Post »nannyatnannydotgov
Posted on August 5, 2011 at 6:31pmYou’ve got it! This is a manipulation by Obambam & Company!
Report Post »LadyIzShy
Posted on August 5, 2011 at 6:47pmthey all are Moodys S&P and the rest.. they ALL want a one world order
Report Post »mattmo79
Posted on August 5, 2011 at 6:23pmThere’s a shocker, did anyone really believe that continued out of control spending by the federal government was going to protect our credit rating! Really! It was out weeks ago that if the federal budget wasn’t cut by at least 4T over the next 10yrs we would be downgraded. Shocker!! Since we didn’t pass a budget to make the cuts and have at this point no intention of making the spending cuts, what did all the liberal genuises think was going to happen. Duh!!
Report Post »thinkinghuman
Posted on August 5, 2011 at 6:32pmExcellent point.
Report Post »Snowleopard {gallery of cat folks}
Posted on August 5, 2011 at 7:15pmIndeed, excellent point.
Report Post »Patrick
Posted on August 5, 2011 at 6:22pmSurprise?
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