United States of America 'AAA/A-1+' Ratings Placed On CreditWatch Negative On Rising Risk Of Policy Stalemate – CreditMatters Special Edition

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Standard & Poor's: The Potential Credit Implications Of Not Raising The U.S. Debt Ceiling On Time

Paul Coughlin, Executive Managing Director

July 11, 2011--U.S. policymakers continue their discussion about whether to raise America's debt ceiling above its current level of $14.3 trillion. Standard & Poor’s has observed that any failure to raise the debt ceiling would cause significant and long-lasting financial and economic disruptions. In this CreditMatters TV interview, Paul Coughlin, Standard & Poor’s executive managing director, discusses our views on the potential impact on the U.S. economy and the financial markets if the debt cap issue is not resolved in a timely manner.

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The U.S.: What Prompted Standard & Poor's To Revise Its Outlook To Negative

David Beers, Global Head of Sovereign Ratings

April 18, 2011--Standard & Poor's affirmed its 'AAA' long-term sovereign credit rating on the U.S. and revised its outlook to negative from stable. The outlook revision reflects our belief that Congress and the Administration could fail to reach a substantive agreement on a fiscal consolidation program between now and the elections of 2012. In this CreditMatters TV video, Standard & Poor's David Beers, global head of Sovereign Ratings, takes an in-depth look at the fiscal situation the U.S. finds itself in and the potential milestones that could spur a downgrade.

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S&P's Updated Sovereign Ratings Methodology Aims To Provide A Clear Reflection Of The Fiscal Climate

Alexandra Dimitrijevic, Chief Criteria Officer

June 30, 2011--In this CreditMatters TV segment, Standard & Poor's Chief Criteria Officer Alexandra Dimitrijevic discusses some of the recent updates made to our sovereign ratings methodology. According to Dimitrijevic, Standard & Poor's is implementing some key changes, such as improving the clarity of our analyses' format and more strongly promoting the linkage between the sovereign methodology and that of the banking system. Yet despite these changes, we are committed to the fundamentals of our ratings system and the new methodology reflects this fact.

For a limited time, these podcasts are available on S&P CreditMatters for the iPhone and iPod touch. Download the free app.

TOP STORIES

Global Aging 2011: In The U.S., Going Gray Will Likely Cost Even More Green, Now

June 21, 2011--As the baby boomers start to reach retirement age, the percentage of the U.S. population eligible for government support will begin to mount. The U.S. government, however, is not currently collecting enough money to pay its Medicare, Social Security, and other long-term bills. However, the U.S. political system has not made progress toward alleviating the rising cost of paying age-related benefits. Recent dynamics in Washington suggest that agreeing on policy changes to deal with such costs may take time.

Issue Ratings Withdrawn On Debt Issued By The U.S. Government

May 24, 2011--Standard & Poor's converted its issuer credit ratings on the U.S. government to "unsolicited" on Feb. 24, 2011, in light of new EU regulations on credit ratings.

Teleconference Transcript: Standard & Poor's Negative Rating Outlook On The U.S.

April 22, 2011--On April 18, 2011, Standard & Poor's revised its outlook on the U.S. government's 'AAA' credit rating to negative. Why the negative outlook on the U.S. government's rating? In summary, it's because when you look at the underlying fiscal challenges the U.S. government is grappling with, as well as the rising U.S. government debt burden, we think--absent a material fiscal consolidation program embraced by policymakers--that increasingly the U.S. government's fiscal position will diverge from that of its key 'AAA' peers.

United States of America 'AAA/A-1+' Rating Affirmed; Outlook Revised To Negative

April 18, 2011--The negative outlook on the U.S. signals that there is at least a one-in-three likelihood that we could lower our long-term rating on the U.S. in two years. The outlook reflects the increased risk that the political negotiations over when and how to address both the medium- and long-term fiscal challenges will persist until at least after national elections in 2012. Some compromise that achieves agreement on a comprehensive budgetary consolidation program could lead to a stable outlook revision.

Fiscal Challenges Weighing On The 'AAA' Sovereign Credit Rating On The Government Of The United States

April 18, 2011--U.S. policymakers have yet to agree on a strategy to reverse recent fiscal deterioration or address longer-term fiscal pressures. The issue of willingness to pay extends beyond the executive branch, to Congress, and--ultimately--the U.S. public. If this continues into 2013, the U.S. might not be able to put in place a fiscal consolidation plan to halt and ultimately reverse the fiscal deterioration. It is our questions regarding the U.S.'s willingness to pay that led us to revise the outlook to negative.

Credit FAQ: A Closer Look At The Revision Of The Outlook On The U.S. Government Rating

April 18, 2011--One reason for the outlook revision on the United States to negative is that there is a material risk that efforts to reduce future U.S. government budget deficits will fall well below the $4 trillion and $4.4 trillion medium-term targets that Congressional leaders and the Administration separately set out earlier this month. This article contains answers to questions that market participants may ask in connection with this rating action.

FAQ Discusses The Politics Behind Raising The U.S. Debt Ceiling

Jan. 18, 2011--With many developed countries more focused on managing their national debt than at any time in recent memory, the debate brewing in the U.S. Congress over raising America's debt ceiling above its current $14.3 trillion is attracting attention. Beyond the potential deadlock between the Democratic and Republican parties is the larger question of the long-term health of the U.S. economy and the role of the U.S. as the preeminent financial power in the world.

Après Le Déluge, The U.S. Dollar Remains The Key International Currency

March 10, 2010--The U.S. dollar is the world's most accepted currency by most measures. It has remained so despite the global recession of 2008, which germinated in the U.S. If the dollar did not have this role, the U.S. would not have such ready access to external financing, interest rates would rise, and potential growth would fall. But the dollar did not attain this position by accident, nor does the U.S. maintain it simply with inertia.

Banking Industry Country Risk Assessment: United States Of America

Feb. 1, 2010--The U.S. banking system is generally resilient. Not only does it have less overall leverage compared with several mature market systems, but it also has strong access to capital, so that even as the financial crisis was unfolding, banks were able to replace government support with private capital. On the other hand, some of the dynamics of the very open financial system generated competitive pressures that appeared to lead to an erosion of underwriting standards.

Criteria: Sovereign Government Rating Methodology And Assumptions

This update provides additional clarity by introducing a finer calibration of the five major rating factors that form the foundation of a sovereign analysis and by articulating how these factors combine to derive a sovereign's issuer credit ratings. It also aims to incorporate the information derived from the 2008 to 2009 global recession, particularly regarding the potential effect of financial sector difficulties on governments' fiscal profiles. Specific considerations on the credit analysis of sovereigns in monetary unions are also covered.