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Downgrading The US Will Cost S&P $1.5 Billion
Remember when S&P forgot for a second that it lives in a world of pretend free speech, and where telling the truth would promptly result in a lawsuit by none other than the US government under false pretenses (and from which Buffett darling Moody's was excluded) after it downgraded the US from AAA to AA+ in the summer of 2011? A downgrade which as Bloomberg previously reported led to this exchange with then Treasury Secretary Tim Geithner: "S&P’s conduct would be looked at very carefully," Geithner told McGraw according to the filing. "Such behavior would not occur, he said, without a response from the government."
Well, S&P will never make the same mistake again, because according to Reuters, it will cost it $1.5 billion to settle with the government and put the whole "downgrade" episode in the past.
- S&P SAID IN SETTLEMNT TALKS WITH WITH DOJ,STATES: RTRS
- S&P SAID IN SETTLEMNT TALKS FOR $1.5B: REUTERS
- SEC SAID TO BAN S&P FROM RATING PART OF CMBS MARKET FOR A YEAR
- S&P SETTLEMENT WITH SEC SAID TO INCLUDE $60 MILLION FINE
- S&P SETTLEMENT ON CMBS SAID TO BE ANNOUNCED AS SOON AS TOMORROW
And let that be a lesson to anyone else who thinks the First Amendment is anything but window dressing.

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"When in doubt, send an invoice"
"When they pay, rehypothecate the windfall."
Now everybody make sure to be good little serfs and pay your taxes to Uncle Satan this year.
bad news is good news... OH WAIT! [until it ain't].
Russia’s response to a bad rating was to just shitcan the rating agencies.
But SnP will pay the tribute to keep the gig.
Fuck
I think I've gone blind
Power shapes reality.
Money - the only speech that gets heard.
To show the world the US means business, upgrade the US to AAA++ that way everyone will really know the double plus state of affairs...
Where does a credit rating agency get that kind of cash?!
Oh right...
We punished some folks.
Fucking weasel. Were is the squirrel gun?
This is no punishment...
all downgrading was supposed to get thrown out with the marc2market water...
from now on only upgrading.
What's the First Amendment?
doubleplusgood
Debits? Credits?
Profits? Losses?
Fuckem.....
It is all fictional
ever since the first day when they wrap tiny strings around sticks in Egypt, we the hu-man race has been refining...and un-refining the art (or is it science?) of accounting.
All terminology was there, designed to be upgraded, no?
Try look at all the "wholly cow" (or is it sacred?) scheme, SOX, marc2market, grading...
Do you really think balance sheets are there to support forward guides (or is it backwardation), no?
I'd be a-shame if i were an accounting (or auditing) professional. Look at it this way, they have managed to cure the ulcers --- no need for worrying accountants.
There is no world where CDO are anything but ways to move debt onto others and profits into WS.
When was the last time you heard of an Accounting arrest.
Banks don't even need to account for the correct value of worthless houses on their books....
Accounting was one of the things that attracted money to the US business environment. WS has shot that to hell.
dupe
When the US Dollar collapses, S&P will get all of its money back plus interest.
By then it will be standard to be poor.
They should upgrade US to AAAAAAAA+++++++++++++ (valid rating on ebay) and charge US $1.5B for the upgrade
Sounds like Centsles who is a seller over grossly overgraded coins there.
seems like keeping them in-line is simple, we say AAA you better print AAA..free markets and all that.
S&P did try to bring some honesty into the business - but honesty for our .gov is a crime.
Ahhh, Je Suis S&P.
An absolute circus this has become. Lando shaking down the S&P because they decided to actually do their jobs.
Who the fuck would rate a nation with $150 trillion in liabilities and an annual deficit of $1 trillion?
You couldn't buy an Aaron's TV with that kind of credit.
pods
Actually you could, they probably have layaway options too.
I was gonna say...:-)
NOTWITHSTANDING ~ lol [It's a comedy FREAKSHOW bitchez!].
Exactly what I was thinking. Shakedown, extortion....
Tony Soprano is jealous at the magnitude of their criminal reach.
The Bushes are tied to the hip of the McGraws for generations. Ol Barbie Bush sits on the McGraw-Hill advisory board.
Not that it matters
No big deal that can be printed in 2 hrs
get to work Yellen
Ummm, no, the S&P has to come up with this coin, not the US.
pods
.
1.5 billion. Chickenshit to them.
You are reading it backwards.
This is the S&P that has to fork this over. Not the FED/Treasury.
pods
S&P rated Mozilo triple A; but not USSA? wtf?
Gangster government
Treason trials are too good for them, but you're right.
Let's add some RICO indictments.
Screw RICO. We're Government serf. GAAP not spoken here
Those fucking sobs as DOJ should be tarred and feathered and then fed to wild dogs. It was amazing the other day watching BBerg iinterview with some corporate CEO or CFO or something who was suing the government over something and their main concern was whether the guy didnt fear reprisals and as such wasnt it aganst his fiduciary duty!!!!???!!?!?!?! WTF It is time for revolution though I am not holding my breath
" tarred and feathered and then fed to wild dogs. "
You miserable sod, what have wild dogs ever done to you......Yous must be one of them Redneck fellers I hears about...
That is what killed Old Yellen....
She has been mentally dead for some time.
Watch and learn about how criminal they really are:
https://www.youtube.com/watch?v=U1Qt6a-vaNM
This is what is known as a "soft tyranny." Enjoy comrades!
Mother Fucking Murica. Home of the fleeced.
Land of the NeoLiberals
In case anyone has forgotten, S&P President, Deven Sharma, had to depart quickly after the downgrade:
Standard & Poor’s President Deven Sharma will give up his post on Sept. 12 to “pursue other opportunities,” parent McGraw-Hill Cos. said in a statement Monday night. Sharma, 55, will stay on with the firm through the end of the year as Citibank chief operating officer Douglas Peterson becomes the firm’s president.
Sharma’s departure comes barely more than two weeks after S&P announced its decision to downgrade the U.S. credit rating to AA+ amid what it described as uncertainty about Washington’s political climate and whether the United States would be able to make big steps toward deficit reduction.
The agency offered its downgrade even after the Treasury Department argued that S&P’s number crunchers had overestimated future U.S. national debt by $2 trillion and the firm corrected its math in a final release.
“It looks like he’s being helped out the door,” Noel Hebert, a credit strategist at Mitsubishi UFJ Securities USA Inc. in New York, told Bloomberg. “If it was a planned retirement, it should have been handled in a different way.”
http://www.politico.com/news/stories/0811/61890.html
Truth is treason in a fascist, police state.
Truth hurts .
If you don't serve the banksters, you will be punished.
A nation "of the banks, by the banks, for the banks".
.Gov is simply the lackey enforcer for the banks.
The high price of truthiness.
hell S&P is about as dependable as a hong kong rolex
A fake rolex is a great investment. Where else can you buy a chick magnet for $25.00?
They always pretend not to notice, but the eyeballs as big as saucers, are a dead giveaway.
We slapped down some folks.
Worse, they slapped down some folks who were daring to speak truth to power.
Eh, you're talking about an institution whose entire business model wrests on conflicts of interest. They are paid to lie. I guess it's possible that they tried to tell the truth this one time. Hard to say.
"wrests" you did you wrote wrests.....with gold on the rise I find I am laughing at the silliest things......traa llllaaaa calloo callay...
That's seriously messed up.
There is all the proof anyone needs...Ratings agencies are a complete farce, completely worthless as any kind of guide!
The entire system is nothing more than a fraud, plain and simple.
FUBAR!
S&WHO???
fuck them bitches.
" But But we downgraded russia just above junk level isn't that enough uncle sam ?? "
As I said , these agencies are non-neutral and corrupt . Now when it comes to downgrade US suddenly land of freedom will not be happy .
Uncle Sam being that kinda guy leaps to the fore and slaps S&P with another 1.5m for insulting his Russian friends..KAPOW! BLAM! and KAPLOOIE!
(note to self) its just gold fever Dugie so cut it out...must have a Bex, a cuppa tea and a good lie down
A retail arm of F/X trading gets erased over $225m. Zero asks for $5Billion for illegals?
I must be living on an entirely different tangent?
"No Prior Restraint"
Ha!
Let the games begin! Bitchez
Remind me, how many Tim Geitner's "arsonist" are bankrupt and in prison?
Doz teef tho... Blarf.
Who needs a credit rating when you can just print however much you want anyways ?
With no accountability for where the "fine" goes -that should about cover Barry's next 2 golf trips for he and his cronies. Not enough to cover her highness though. Maybe they will use it to help the guys at the VA Hospitals ..... nah
It would have been great to see S&P stand it's ground and prove that the “emperor has no clothes”. Thankfully, it does not take a financial genius to realize that American government and Federal Reserve paper is only backed by thugs with guns.
But that's why they won't let anyone audit the Fed.
They are a ratings agency, aren't they? Doing there job.
And who says the USSA isn't the correct term? Anyone?
I almost feel sorry for S&P. Almost.
Ratings are free speech. Ratings are not free speech.
S&P repsonded with USA = AAAA+
Sooner or later governments will start fining/harrasing/targeting voters for making the wrong voting choice as well. If you think that is far fetched, just remember that with electronic voting they have the ability to know which way you voted.
Umm... we are already punished for making the wrong voting choices...
A $1.5 billion settlement sure beats nail guns and tall buildings....
How much was S&P or any other ratings agency fined for enabling Banksters to steal hundreds of billions via totally phony ratings of MBS. These guys (and the other ratings agencies who did the same thing) are crooks and should be doing hard time, let alone getting off with a fine.
One day they'll give the people such a bitch slap, that they'll wake 'em up.
all ratings agencies should be shuttered. DO YOUR OWN FUCKING CREDIT WORK!!!
I'd love to, but...
1) I have a job in a non-finance related field, so I don't have the good tools to speed things up...
2) Companies are fairly loathe to send me their financials when I have no relationship with them...
Ratings agencies exist because an information vacuum exists. Getting rid of the rating agencies doesn't do anything to solve the information vacuum problem, it only makes it worse and lets the biggest thugs in the room interject themselves more directly than they already are.
What's needed is something like a wikileaks for corporate financials...
Clearly the out of control government has no fear of us or our reaction at all.
To fine a rating agency for doing their job is so overtly corrupt it shows how the political elite despise us.
Obama's Amerika.
Ratings agencies are moot. If Iran becomes a nuclear power, how does that increase it's industrial/intellectual production?
Iran has suddenly procured Aliens to use nano engineering, ffor their warheads.
Iran has the capacity already to produce a nuclear warhead. Iran doesn't have the capacity to produce a multistage hydrogen bomb.
Iran want's to make the warheads very small. That my friends, is why we have vested interest.
Personally, I like electricity! Bitchez
Raise your hand if your country is Trillions of Dollars in the red like the US... (crickets, crickets)
US Economy is JUNK. Get over it...
Even Orwell could not foresee this circus.
The banksters need to repay us.
Thanks for calling the new Fiat Ratings Company, how can we help you today?
How come when I see that picture of Geithner I want to go "American History X" on those ugly chompers? Put your mouth on the curb, Tim!
Hey, theives don't live in dens for nothing. I wonder what would happen if they just unlisted them.
The whole paradigm is simply pathetic and ridiculous.
S&P should no longer report the credit rating of the U.S. government. That way they can't be right or wrong.
http://townhall.com/columnists/neilmccabe/2015/01/17/obama-to-lay-the-wood-sp-with-1b-fine-after-us-debt-downgrade-n1944335/page/full#!
Obama to Lay the Wood S&P with $1B Fine After US Debt Downgrade
Neil McCabe | Jan 17, 2015The Justice Department is about to put the squeeze on the Standard & Poor's credit rating service for the tune of $1billion, roughly its 2014 profit, and a fine meant to send a message, according to a Jan. 12 report in The New York Times.
The message: Do not tangle with the Obama administration.
The charge: Standards & Poor's analysts misrepresented their sincere opinion of securities, and instead downplayed the amount of risk associated with the securities, specifically Residential Mortgage-Back Securities and Collateral Debt Obligations, in order to ingratiate themselves to the companies issuing the securities.
This charge, which Attorney Eric H. Holder Jr., made Feb. 5, 2013, was completely over-the-top, but we are talking about a $1 billion fine and sticking someone with blame for the 2008 financial crisis.
“Today’s action is an important step forward in our ongoing efforts to investigate – and – punish the conduct that is believed to have contributed to the worst economic crisis in recent history,” Holder said.
Driving the civil action against Standard & Poor's is Stuart F. Delery, the acting assistant attorney general. Delery is the attorney behind the crusade forcing the Boy Scouts of America to welcome homosexuals as both scouts and scout leaders. It made Delery a celebrity lawyer in left-wing legal circles.
The basic DOJ narrative is that because a company hires S&P to rate its products, S&P has an incentive to tilt its analysis in favor of the company and its products. Investors, fooled by S&P's sunny-day analysis, lost money with the securities went south.
Frankly, this narrative is foolish. There is no incentive for a rating agency to be wrong about the risk associated with securities—regardless of whatever emails some idiots sent to each other stating otherwise.
First, what good is the rating from a rating company that it is always wrong?
Second, if the system, where companies pay to have their products rated was prone to abuse, would not everyone get the coveted Triple-A?
The real story, of course, is not about knuckleheads throwing money into a campfire on the say-so of devious S&P analysts, triggering the worst financial crisis since the Great Depression.
The real story is that Standard & Poor's, two days after President Barack Obama signed the Budget Control Act of 2011, downgraded debt issued from the U.S. Treasury from AAA to AA+.
In court filings, people at S&P claimed that then-Treasury Secretary Timothy F. Geithner communicated to them that they would be punished. Until Holder lined up his charges, the rating firm was just waiting for the other show to drop.
The Budget Control Act of 2011 was born of one in a series of standoffs between Capitol Hill Republicans and the president. The act immediately raised the debt ceiling by $400 billion and gave the president authority to raise the debt ceiling another $1.2 trillion.
The BCA was expected to reduced increases in the federal debt by $4 trillion over 10 years, but instead the number was closer to $2.4 trillion.
S&P said it was not impressed.
“We lowered our long-term rating on the U.S. because we believe that the prolonged controversy over raising the statutory debt ceiling and the related fiscal policy debate indicate that further near-term progress containing the growth in public spending, especially on entitlements, or on reaching an agreement on raising revenues is less likely than we previously assumed and will remain a contentious and fitful process,” S&P said in its statement.
This was not a small deal. It was a big deal. In the financial services industry, Treasury debt was and is recognized as the most secure securities available.
Besides being theoretically risk-free, as a practical matter, many organizations, foundations, trusts and other vehicles are required to invest in AAA-rated instruments. The easiest was to meet this requirement is to invest in treasuries, which suddenly had to be dumped to meet fiduciary standards.
For the record: The day Obama signed the Budget Control Act of 2011, federal debt stood at $14.5 trillion, 93 percent of Gross Domestic Product, which is the annual measure of the size of the American economy. On Jan. 15 at $18 trillion, 101 percent of GDP.
Clearly, Obama is more interested in controlling dissent, n
Neil W. McCabe is a journalist working in Washington. He was a senior reporter for the Human Events newspaper and for many years a reporter for The Pilot, Boston's Catholic paper. In 2009, he
I think the real story about Holder's latest announcement is the LACK of any coverage outside of
http://townhall.com/columnists/neilmccabe/2015/01/17/obama-to-lay-the-wood-sp-with-1b-fine-after-us-debt-downgrade-n1944335/page/full#!
and
https://www.teapartycommunity.com/blog/15866/payback-obama-to-hit-s-p-with-a-1-billion-fine-after-u-s-debt-downgrade-1-1/
Re: "Downgrading The US Will Cost S&P $1.5 Billion"
This headline is misleading and should read, "Having Downgraded The US Will Cost S&P $1.5 Billion." ZH should be able to distinguish between historical and prospective events.
hey Warren Buffett...can you help spring Jon Corzine...maybe Charlie Munger can figure something out....you guys are brilliant and 'oracles' and all that. Its not fair you know
Let's hear it for S&P:
The penalty for egregiously misjudging the value of $Billions of MBS - ZERO
The penalty for dissing the US of A - $1.5 Billion
Timaaaaaaaaaaaaaaay! ...
This is why China and Russia are creating their own ratings agency.
So, why file the complaint in the Central Dist. of California and not New York? Where is the lawsuit against Moody's or Fitch or....the sell side cretins? Angelo anyone? Lehman? Bear? They're the ones who made all the misrepresentations. Here's the complaint:
http://www.justice.gov/iso/opa/resources/849201325104924250796.PDF
Unbearable to read, but Page 76-77 is one area of interest....they make it out like it was S&P who blew up the housing market. While S&P went along as mules, it was was all the REMICS that ignored their own underwriting, didn't fund the trusts or ever properly acquire the assets (mortgages, and rehypothicated/multi pledged them) and represented that they did. That's what blew up housing. Classic pump and dump.
Can't make this shit up....and don't fuck with "AAA" America, S&P. Ha. What a fucking joke.
Meanwhile, Jon Q. Public in bum-fuck Indiana who bought his family home for $200k in 2006 with 20% down, is still underwater 75 large or threw in the towel and Blackrock owns it and is now renting it out. What about that, SEC, USDOJ, Timmy?
Fuckers.
You cannot make this shit up.
The first amendment is window dressing? Next thing I know you will try to tell me that we are not "spreading freedom".
Rob one Paul to pay another Paul ( Goldsucks/Morgue etc).
Balancing the Books
(All Peters, of course, can continue drowning)