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Moody's Says It Expects To Place US Rating For Downgrade Review If No Progress On Increasing Statutory Debt Limit

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Thu, 06/02/2011 - 13:38 | 1333025 oogs66
oogs66's picture

So if you don't promise to increase your debt we will downgrade your existing debt?  LOL!

Moogy says 'more debt good, less debt bad'   yeah, that makes sense

Did Uncle Warren approve this?

Thu, 06/02/2011 - 13:36 | 1333044 TheTmfreak
TheTmfreak's picture

That is literally what they're saying.

When has anybody ever used more credit and gotten a better credit rating BECAUSE of the credit? (I thought credit ratings were about the ability to pay back credit based on past experiences...)

If you pay off a credit card, with another credit card... thats not paying off debt.

Thu, 06/02/2011 - 13:40 | 1333059 Dolar in a vortex
Dolar in a vortex's picture

Wow! Whose pocket are they in?

Thu, 06/02/2011 - 13:49 | 1333093 AR15AU
AR15AU's picture

Anyone who uses Moodys to make investment decisions is FUCKING INSANE.

Thu, 06/02/2011 - 14:04 | 1333171 camaro68ss
camaro68ss's picture

you got to shoot yourself in the face to stay alive.... you guys ready?..... one, two ,three, FIRE!

Thu, 06/02/2011 - 14:13 | 1333233 andybev01
andybev01's picture

I think it's more akin to selling your children into slavery than shooting yourself but that won't affect me, I have no children.

Thu, 06/02/2011 - 14:32 | 1333332 wisefool
wisefool's picture

This is my printing press.

This is my tax code.

One is for killing peoples way of life.

The other just makes it more fun.

Thu, 06/02/2011 - 15:02 | 1333464 max2205
max2205's picture

This message brought to you (Congress) by the Association of FED and Treasury.

Warning, sideeffects incude vomiting, diahreha, loos of foreskin and testicles, loss of vision and hairloss.

Fuck you Moody's!!!

Thu, 06/02/2011 - 13:52 | 1333115 equity_momo
equity_momo's picture

Youll be shocked to hear that even you sir , a mere plebian , like all of us at ZH , can infact improve your credit rating by taking out more credit or debt.  

I got rid of my mortgage last year and my credit score went from near perfect to average in one fail swoop....   ask around , it happens to every individual or entity. More debt = higher "score" or rating.

I will probably get turned down if i ever want a credit card due to the fact i have savings but no debt.   Bizarro World , one which is going to collapse.  Ho-hum.

Thu, 06/02/2011 - 13:55 | 1333144 centerline
centerline's picture

Yup.  They like to a see a combination of debt and good servicing of that debt.  If you fail to have debt (or enough debt) or fail to service the debt, your rating will drop.

Thu, 06/02/2011 - 14:02 | 1333156 LongBalls
LongBalls's picture

Who give's a chit. The money you save by being a debt free customer that pay's in cash far out weights any mere 5% bump in your interest payment for a loan on goods. 

There are a lot of people who wish they were in your position.



Thu, 06/02/2011 - 14:08 | 1333197 equity_momo
equity_momo's picture

I rent....

 i just had an out on my property that is now underwater , so i took it. I wont be high fiving until i have zero monthly checks going to my living accomodation.

Thu, 06/02/2011 - 14:02 | 1333159 Robot Traders Mom
Robot Traders Mom's picture

Yeah, this fucking kills me. I own a house and am and have been current. I took out a credit card about 5 years ago to bring my "credit" up. I would put $3-4k/month on it and pay it off immediately. They cancelled it on me last year saying something along the lines of no longer fitting into their credit profile.

I have no debt outside of a mortgage, a substantial income, and I have an average credit score.

If I were to go into a BMW dealership today, I would get a shittier rate than a 19 year-old college girl with a part-time job, $20k/yr income, and 8 credit cards.

This is the only proof I need that the world we live in is one giant ponzi.

Thu, 06/02/2011 - 14:07 | 1333210 equity_momo
equity_momo's picture

Its fucked up thats for sure..

im done with worrying about it - most of us here know whats happening. We can either prepare so we are in a better position that the 19yr old college girl , or we can drink to forget and live like the rest of the walking mooks out there.

Sometimes i think theyre happier but id rather understand the game than be a mark.

Thu, 06/02/2011 - 14:16 | 1333232 Robot Traders Mom
Robot Traders Mom's picture

Sometimes i think theyre happier but id rather understand the game than be a mark.


Thu, 06/02/2011 - 15:07 | 1333470 max2205
max2205's picture

I bet Obamarama would give you a $100k student loan...too bad you can't buy food with it

Thu, 06/02/2011 - 15:24 | 1333592 Ben Fleeced
Ben Fleeced's picture

Oh yes you can!

Thu, 06/02/2011 - 14:19 | 1333243 Thomas
Thomas's picture

I have no debt whatsoever, own my house, plenty of assets and my credit rating totally sucks.

Thu, 06/02/2011 - 14:26 | 1333276 TheTmfreak
TheTmfreak's picture

See my post below.

Why should it be assumed that you should be trusted with large amounts of debt if you can't even show you can handle debt responsibly? (by having no debt)

Credit rating is way way over relied upon however.

Thu, 06/02/2011 - 14:33 | 1333265 TheTmfreak
TheTmfreak's picture

While I'm not arguing for the system, to me it makes sense that you must have some sort of debt to show that you can be responsible with debt.

While I think its ludicrious that overnight somebody's credit score can drop as a result of paying off a mortgage its not that irrational to understand.

Can't handle taking high amount of debt? Why should you have a large credit rating? I do think that credit ratings should take into account asset/debt ratio however. But then again thats the lenders responsibility to look at. The problem I see with the system is the over reliance on some magic number that, like I've stated, doesn't even take into account assets.

Thu, 06/02/2011 - 14:35 | 1333331 Rynak
Rynak's picture

I get no credit AT ALL, because........ umm, i think it's because i cannot be fired (freelancer)

Thu, 06/02/2011 - 13:48 | 1333087 rsi1
rsi1's picture

  • of course, otherwise the ponzi ends!

Thu, 06/02/2011 - 14:10 | 1333205 jus_lite_reading
jus_lite_reading's picture

^^THIS^^ Everything else is just noise

Thu, 06/02/2011 - 13:48 | 1333089 Quinvarius
Quinvarius's picture

They know we pay the interest on our debt with new debt.  We don't have the tax base to cover it and continue functioning.

Thu, 06/02/2011 - 13:53 | 1333119 Robot Traders Mom
Robot Traders Mom's picture

That is exactly right. Moody's/S&P/Fitch rate on the ability to payback their debt, not the strength of their currency.

As fucked up as it is, the US could never theoretically default by not paying, as they are the reserve currency. They can devalue the dollar to infinity, but they will pay, albeit worthless dollars.

This is the fucked up system that we live in. I am a broker and can tell you that the municipal and corporate bond rating system is one of the biggest jokes in the financial system.

Meredith Whitney is not wrong, just early.

Thu, 06/02/2011 - 14:04 | 1333172 centerline
centerline's picture

That pretty much sums it up for most people here... just early.

Thu, 06/02/2011 - 13:59 | 1333163 crazyjsmith
crazyjsmith's picture

Yep, just like the alcoholic who wakes up with a blistering Hangover and thinks the only solution to cure that hangover is to grab a beer and start drinking again. 

Or the Heroin addict who can't stop shaking from withdrawals, feels the only way to cure the shakes is to grab the needle.

Or the starving crackhead who will use his last $5 bucks, not on a burger, but another hit.


Hello, my name is Earth, and we clearly have not met. 


Thu, 06/02/2011 - 15:29 | 1333603 Citxmech
Citxmech's picture

“If you’re living high on that cheap credit hog,
Don’t look for cure from the hair of the dog.
Real savings come first if you want to invest,
The market coordinates time with interest.

“Your focus on spending is pushing on thread -
In the long run, my friend, it’s your theory that’s dead.
So sorry there, buddy, if that sounds invective,
Prepare to get schooled in my Austrian perspective.


Keynes v. Heyak, Pt I.

Good shit there boss.

Fri, 06/03/2011 - 08:34 | 1335231 thriftymost
thriftymost's picture

The Austrian perspective is a rich man's one.  I save money and want govt. to leave me alone--why doesn't everyone else?

Most people, though, don't have any money, or the means to acquire it.  They go into debt because without a mortgage they don't have anywhere to live, without a car lease they can't get to work, and so on.

Austrians, like Objectivists, live in a fantasy world of narcissistic delusions.  It's all a fraud.  And it's utterly inimical to progress.

Thu, 06/02/2011 - 14:07 | 1333190 LongBalls
LongBalls's picture

This is nothing more than a shake down to force Congress to up the debt limit in conjunction with forcing them to make modest cuts in spending that will extend out 5-10 years. Notice the recent take down in the market as insurance. These pukes are not even TRYING to hide it anymore. They own this country. At least until the medium of exchange is changed.


Thu, 06/02/2011 - 14:41 | 1333373 mayhem_korner
mayhem_korner's picture

Ya can't fix stupid...

We're so cooked.

Thu, 06/02/2011 - 13:33 | 1333026 tao400
tao400's picture

Wow. Have not looked at the market but am going to right now.

Thu, 06/02/2011 - 13:38 | 1333029 TruthInSunshine
TruthInSunshine's picture

Hey, I remember when Congress initially rejecting TARP and the 8% intraday equities drop that scared the living beejeezus out of 401(k)/IRA/Pension Plan holders, getting them to panic and call their elected representativesTM.

Oldest trick in the book, Moody's.

Thu, 06/02/2011 - 13:38 | 1333051 cougar_w
cougar_w's picture

The plutocrats want that sweet, sweet QE3 sugar so bad they can't stand it. They're going to be pulling out all the stops now br'utha. Everything now, all the time, every day and every night, until The Bernank is just forced -- forced I tell you, oh the humanity -- to print more money for his important friends.

Thu, 06/02/2011 - 13:47 | 1333106 Oh regional Indian
Oh regional Indian's picture

"oh, the humanity" is always funny.

But yes, the summer squeeze is on, and I'm not talkign lemons here.




Thu, 06/02/2011 - 13:34 | 1333032 slaughterer
slaughterer's picture

That killed the rally!  Thanks Moody's!

Thu, 06/02/2011 - 13:52 | 1333118 Cdad
Cdad's picture

What...the whole three minutes worth of it?  I can see where a guy would be pissed about the lost productivity.


Thu, 06/02/2011 - 13:34 | 1333035 cougar_w
cougar_w's picture

When did Moodys become a arm of AlQueda? Because this is nothing but terrorism aimed at our freedoms.


Thu, 06/02/2011 - 13:37 | 1333046 TheTmfreak
TheTmfreak's picture

Economic terrorism to be precise.

Thu, 06/02/2011 - 13:38 | 1333036 A_MacLaren
A_MacLaren's picture

Right on cue.

Thu, 06/02/2011 - 13:35 | 1333038 Putty
Putty's picture

This makes perfect sense.

Thu, 06/02/2011 - 13:46 | 1333084 Rynak
Rynak's picture

.sense makes this, No

That's what you get for computing credit ratings on little-endian hardware.

Thu, 06/02/2011 - 13:39 | 1333043 nathan1234
nathan1234's picture

Republicans own Moody's

Thu, 06/02/2011 - 13:37 | 1333049 Long-John-Silver
Long-John-Silver's picture

The Sheeple will soon demand QE3. The unfolding plan continues.....

Thu, 06/02/2011 - 13:40 | 1333058 cougar_w
cougar_w's picture

Yes the war in the east is proceeding spendidly.

Thu, 06/02/2011 - 13:54 | 1333124 Oh regional Indian
Oh regional Indian's picture

it is, isn't it? The other ring of fire. AfPakIr. Look at poor pakistan especially. Played like patsies through a deeply corrupted government. Every day, it's being made to look like an ungovernable nation, perhaps ready for some martial law again. Then, all bets are off. Pakistan and Tibet are the two fulcrums (Kashmir espicially) for various historical reasons.

Fascinating times, like watching reality kicking fiction's ass.


Thu, 06/02/2011 - 14:02 | 1333142 cougar_w
cougar_w's picture

Then maybe what you need is some better fiction:


Where we answer with a resounding "Yeah baby" the eternal question -- can you really get blood from a turnip?

Thu, 06/02/2011 - 14:11 | 1333214 Oh regional Indian
Oh regional Indian's picture

your writing? Interesting. With the Fed bit, clearly a ZH reader. 


Thu, 06/02/2011 - 14:23 | 1333259 cougar_w
cougar_w's picture

Mine. And I notice over time that my fictional treatment of the banking class is becoming increasingly harsh. That too, I suppose, is the imprint of a ZH reader.

Hmm. And I was suddenly just wondering what might happen if Fortran "accidentally" hacked into a ratings agency, found a computer running a financial test model and "inadvertently" corrected some faulty assumptions for them as a "service" and didn't actually tell anyone? And the undoctored real results went out on the news wires because nobody actually looks at that this cr*p anymore, you know.

That would be really funny. Ha ha.

Okay gimme a couple days ... this should be good ...

Thu, 06/02/2011 - 19:26 | 1334321 Sokhmate
Sokhmate's picture

By Fortran, do you mean the big-titted, blue-skinned hairy angel?

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