Tuesday, January 13, 2009

U.S. Not Spain, S&P Claims

Just as our opinion of S&P was notched up to deplorable from abysmal, they go ahead and pull this wool over our eyes:

Analyst Nikola Swann vows the reasons he can sleep at night include the following:

"We have affirmed the ratings on the U.S. despite our judgment that fiscal risk has noticeably increased, as we expect that the fiscal deterioration will be temporary (Ed. what's $10 trillion when the printing presses are in turbo boost mode) and that the country's other credit strengths will withstand current pressures."

"The ratings on the U.S. primarily reflect our opinion of the sovereign's high-income, highly diversified, and exceptionally flexible economy. The ratings also reflect our view of its strong track record in terms of growth-enhancing policies, as well as the unique advantages coming from the U.S. dollar's role as the key international currency. In our opinion, these strengths continue to outweigh the U.S.'s weakening current-year fiscal performance, growing risks in its financial sector, longer term challenges associated with its entitlement programs, and the nation's weak external position."

Oh well, we would be happy to pull up S&P's ratings from 2006/2007 on MBIA, Ambac, Lehman, Bear and a few others, to verify credibility, but frankly are just too lazy. So let's just take this for all it's worth.
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