S&P cuts U.S. ratings outlook to negative

I can see it now. Announcing the QE to end all QEs, the Mother of All QEs, QEIII! It's so big we had to use Roman Numerals! 16 digits of stimulus. We're sending the markets into orbit and we do not care WTF happens down the road.

 

why is the USD ripping up on this news?

 

Of course, Standard & Poors isn't actually allowed to evaluate our U.S. debt. Who is? Well, nobody. Why? Because U.S. economics > the world!

I'm glad they sent out this message... facing reality may be tough, but it's necessary.

 

I'm guessing there was some pre-positioning (short USTs & USD) ahead of this "surprise" announcement.

But with the news out safe haven flows are dominating & USD and UST win out.

Greek 2yr yield moved above 20% today. Seems like default is becoming inevitable for Greece.
Then what for the Euro?
USD has problems, but EUR problems are bigger.

 

i would think this specific news wouldnt cause the usd to be the safe haven... that it would be some other currency if at all

so if the US defaulted on its debt, would the USD go up since it is a safe haven?

 

Are you kidding me? Ratings agencies have been incompetent for many, many years. Stop trying to portray them as the ones lifting the "smoke and mirrors".......they usually contribute to the smoke and mirrors.

 

S&P downgraded Japan in '02, nothing's changed since for them.

The funny thing is, look at the posts of fear popping up, these are the republicans with that walnut sized fear gland in their heads working overtime.

 

I understand...so my question is do you want the rating agencies to continue to look the other way or just do their jobs?...don't try to put words in my mouth steve liesman. We know you are one of the pom pom triplets.

 

By Barry Ritholtz - April 18th, 2011, 11:10AM There is an old Wall Street joke about analysts: “You don’t need them in a Bull Market, and you don’t want them in a Bear Market.”

Which brings me to Standard & Poor’s. They put a “negative” outlook on the U.S. AAA credit rating, citing rising budget deficits and debt.

To which I say “Who Cares?”

Its not that I disagree with their assessment — I do not — but I pay it little heed. It was much more important to me as an investor that PIMCO’s Bill Gross was out of Treasuries a month ago (and indeed, is short) than what S&P says. That was all any bond investor needed to know — no ratings agency necessary.

http://www.ritholtz.com/blog/2011/04/why-listen-to-sp-on-us-debt/