We depend on this outfit for financial ratings and they make a $2T mistake in something this important! :smack:
What the hell, did they forget to carry a 1 or something?
What a total fuckup.
Not surprising from the same geniuses that enabled the subprime mortgage fiasco. They pick today to grow a conscience.
CNN is now reporting that S&P is proceeding with the downgrade despite their minor ($2 trillion) miscalculation.
Of course, the real fuckers are our wonderful Congress. You can bet the credit card companies will jack up everyone’s rates next week, using this as an excuse. Just what we need in the middle of a recession, everyone who is already struggling with credit card debt gets to send more money to the banks and spend less on actual products. What a great way to run an economic recovery.
I hope every single one of the fuckers gets voted out next year, for letting this happen.
I wonder if anyone will sell me gold over the weekend.
Right. The ratings agencies didn’t know shit from shinola throughout the years leading up to the financial crisis. They didn’t have a clue what was going on. That’s arguably worse than a $2 trillion error on a debt that was huge either way.
Bank makes error in your favor.
Collect 2 Trillion Dollars
Christ I’ve been watching the ‘pundits’ and the conservative ones are creaming in their pants over this. It’s all Obama’s fault.
I think the URL above says all I want to say. Several European Nations, including the UK, France, and Russia, along with both China and Japan, are saying they will not treat the U.S. debt any differently due to this downgrade. It seems that this error has affected faith in S&P itself, now that they went ahead and lowered the debt rating anyways.
Obviously, Obama didn’t bribe the right S&P functionaries.
Saying they made a $2 trillion error makes it sound like there was a math mistake or something; in reality, it was a change in assumptions.
The Congressional Budget Office has various scenarios that they use to project future years cash flow. The error involves which assumption to use for projecting disretionary appropriations. S&P originally used the Alternative Fiscal Scenario of the CBO which assumes that discretionary appropriations will grow at the same rate as nominal GDP. The Treasury department believed that the CBO’s baseline scenario which assumes growth in discretionary appropriations to be lower was more appropriate and S&P agreed to make the change. This change resulted in a change in 2021 debt projections to be $20.1 trillion versus $22.1 trillion. The change was much less dramatic in the short term: 2015 debt is now projected to be $14.5 trillion versus $14.7 trillion. These debt numbers, by the way, are net governmental debt.
S&P states they were more concerned with medium term projections. 10 years out is considered long-term.