US Credit Lowered

From USA Today:
"S&P downgrades U.S. credit rating from AAA"

The U.S. lost its esteemed AAA credit rating after being downgraded by Standard & Poor's Friday, eroding the elite standing it has held in global markets for more than 70 years. The nation's credit rating was cut to AA+ after S&P said the compromise made by Congress and President Obama this week to cut spending and boost the debt ceiling "falls short of what, in our view, would be necessary to stabilize the government's medium-term debt dynamics." "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," the ratings firm said. The U.S. Treasury tried to get S&P to reconsider its ratings downgrade Friday. Treasury officials pointed out that S&P's original analysis of the debt deal's $2 trillion in savings was flawed. The rating agency adjusted its analysis but still downgraded the U.S.' credit rating, according to a government official familiar with the matter. The source declined to be identified because he was not authorized to speak on the record.

^ I don't know who S&P are or why they get the authority to issue credit ratings to countries (or Moody's.) I have heard a lot of different views on what the downgrade really means. Some people say it won't do much and others say we will be back to a barter system. I guess the only thing to do now is wait and see. ^

http://www.usatoday.com/money/economy/2011-08-05-s-and-p-downgrades-credit_n.htm