He who places his hope on thee, O Virgin all-glorious, will prosper in all he does.

Inscription on Byzantine coin during reign of Romanus III

Tuesday, August 23, 2011


Big surprise. S&P's President is stepping down.

Over at
John's blog a few weeks ago, I commented on the prospect of Moody's downgrading the creditworthiness of US Treasuries:

It'd behoove Moody's to make contingency plans to evacuate to an alternative foreign situs if it were to prematurely downgrade US Treasuries. That's hardball territory.

Now that S&P has crossed that Rubicon, I'd be surprised if its credit ratings' franchise remains intact. The Justice Department has reinvigorated its investigation of S&P's ratings of mortgage bonds.

You know what this means? The Administration can't fault S&P on the merits of its rating of Treasuries, despite the bluster about the US's still being a "triple A country", and will turn over rocks to indict it on the merits of some moron employee's careless remark about mortgage bonds.

In my view, S&P showed remarkable courage in focusing our attention on the seriousness of the debt issue. There's a small window of time (approximately three years) during which Washington can actually do something to keep the debt from spinning out of control.

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