The S&P Credit Agency has become one of the most disliked companies worldwide, with its recent actions under Deven Sharma’s leadership prompting widespread outrage. It’s no wonder President Obama is breathing a sigh of relief; now, blame for the market chaos can be shared. Sharma’s pursuit of fame and influence has destabilized global markets, costing millions their jobs and trillions in wealth.
The S&P’s decision to downgrade US sovereign debt, despite prior discussions with top officials, reflects poorly on their credibility. This move, announced on a late Friday evening, further shook an already fragile market post-debt ceiling crisis. It’s a slap in the face to political leaders and citizens alike.
Contrary to belief, the downgrade doesn’t just impact the wealthy. Job security is now a distant dream for many, with layoffs looming and bonuses disappearing. Graduates face rescinded job offers, small businesses hesitate to hire, and corporations hoard cash out of fear of future economic blows. Confidence, both domestic and global, is shattered.
The US debt issue was no secret, evident from months of Congressional wrangling. More time for recovery and discussion could have eased the blow. Instead, the downgrade triggers a cascade effect across global markets, leaving no one feeling secure, not even at a Giants game.
Personal financial strategies are shifting in response. Saving rates are skyrocketing, with retirement planning now requiring millions just to earn a modest income. Savers suffer as US Treasury yields plummet amidst the chaos.
Sharma’s decision to downgrade, alongside similar actions from Moody’s and Fitch, raises questions about their real motives. Despite America’s unique financial tools, the ego-driven pursuit of influence drives these decisions. Brace yourself; more downgrades may follow, leaving even municipal bonds vulnerable.
In hindsight, the S&P’s history of high ratings for sub-prime mortgages and other risky assets underscores their erratic judgment. France, currently AAA-rated, remains a curious exception.
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Regards,
Sam
