Saturday, February 28, 2015

Couldn't happen to a nicer city

Chicago Tribune: "Moody's downgrades Chicago's debt rating."  It's now two notches above junk status.

Extra - From Instapundit.


Hedge fun said...

Yet this week, Fitch Ratings just affirmed Chicago's debt rating, two rungs higher than Moody's. While Standard & Poor's just renewed Chicago's rating at A+, two levels higher than that. But Moody's has indicated that it may lower the city's rating even further.

In that spirit, I predict that the winner of the upcoming Floyd Mayweather-Manny Pacquiao title fight will be Mayweather. Or Pacquiao. Or a double DQ. You heard it here first!

Eric said...

Chicago: at least we're not Detroit!

The only important ratings are ones I agree with said...

"Standard & Poor's will save us socialists from embarrassment!"

Glad-Eye Moody said...

"We socialists love Moody's! Their fraudulent ratings helped cause the crash that put our Kenyan apparatchik into the White House!"

Socialist & Poor said...

"And while everyone twitter-shames Moody's on cue, we socialists of course will hope no one remembers that Standard & Poor's got into more trouble than Moody's for fraudulent ratings leading to the financial crisis, because that would undercut our worship of them for rating Chicago A-plus!"

"And then we socialists would have to admit that after receiving a $1.38 billion bitch-slapping from the government, S&P's standard method of rating any and all government debt may be to ask, 'How high do you want the rating to be?'"

Oh, those poor, poor standards... said...

"Standard & Poor's is bad when it maintains Chicago's debt rating, because an "A+" rating sounds really good so that's bad, even though an A+ is not so good which means it's bad, which is good... but S&P was good back when it downgraded the U.S. credit rating in 2011, because we could say it meant Obama was bad, except that Moody's declined to follow suit then, which made them bad, although making their Chicago rating 1 more bad means they're now good... but before that, S&P was bad when it issued fraudulent ratings... but only in retrospect, not when we were saying the economy's ratings were good, so we could beat Senator Obama.

But we didn't... which was bad.

P.S. Socialists!"

Let me spin your head so you won't notice I got nothing said...

You could have just said, "I have no way to respond to those facts."

But that message still came through loud and clear.

siacd999 said...

Maybe Rahmn Emmanuel needs to get the Chicago PD to pick up the ratings guys to have a little talk down at the new police facility that's been in the news.
Chicago has been the butt of jokes about corruption and politics for years, yet the American people took the promises of a Chicago politician seriously enough to get him elected twice.

I’d never spin anything as fragile as your head said...

But that message still came through loud and clear.

What didn’t make it through is the self-irony of your signing a post “The only important ratings are ones I agree with." In case you haven’t noticed, Switzerland, you’re the only one rooting for a favored Chicago debt rating out of the three.

So it’s hooray for Moody’s today and boo to Standard & Poors, just as it was hooray in 2011 for the toothless S&P downgrade and boo to Moody’s. “The only important ratings are...” something something. Of course, Fitch Group can also apply for impermanent blogsturbation cred any time, by making a standalone assessment that’s politically irksome to Democrats.

"I have no way to respond to those facts."

Oh, I certainly did have a way. I made fun of you!

But we mustn’t neglect your facts. The fact that “socialists" "worship" a financial services company is by far your looniest. That funny fact had some stiff competition, too, such as the fact that after “a $1.38 billion bitch-slapping,” the immediate, most logical response for S&P might be to deliberately make their ratings LESS credible, LESS accurate, and MORE subject to massive lawsuits. Are you sure you’re not a CEO? Acumen like yours should not be wasted.

You probably mean the fact that S&P "got into more trouble" than Moody's. Man, that’s a tough fact for me to handle. I got nothing but spin. (1) Nothing, (2) spin, and (3) the fact right there in your article that you cited: that a higher percentage of Moody's pre-crash profits were coming on its fraudulent, faulty evaluations than S&P’s had been.

Maybe this would be a good time to mention one other, related fact: (4) an identical federal probe against Moody's has only just recently turned serious.

"The Justice Department began looking into Moody’s as far back as 2010, the people said. But government lawyers held off on a Moody’s case as they pursued a lawsuit against S&P that eventually was filed in February 2013... On top of the Justice Department’s probe, the attorneys general from Connecticut and Mississippi also have lawsuits pending against Moody’s but they put their cases on hold while pursuing S&P."

Here are some more unhappy facts, for some:

The most sophisticated investors, on the other hand, are paying less attention to ratings than ever... The 2011 [Standard & Poors] downgrade had been ignored by the markets, as are many calls on government debt are by all of the raters, including their downgrades of Japan and Italy in December 2014, just as investors had deemed the U.S. a better bet after S&P’s downgrade. One analysis found that since 1970, rating changes on sovereign debt have been ignored as often as followed.

Poorly SPun said...

Hmm...So I'm "rooting for a favored Chicago debt rating out of the three." That's denser than mercury. You can't find anything I've said in this thread that indicates I care what any rating agency has to say about anything. Only in your imagination do I give Moody's "cred" because their rating might be "politically irksome to Democrats." I simply teased you about the way you reflexively gave "cred" to S&P (by implication, through impugning Moody's). Notice how what you were trying to do, becomes attributed to me, in your mind.

You do so much projecting, they must be begging you to come work at Cinemark.

And there's that prickly reaction to the word "socialist" again. I repeat, it's a joke, not a homework assignment. For awhile I thought you got it, as we were both recounting what "we socialists" think. But, alas.

I love the hopeful note you end on, though. The Feds are actually "looking into" Moody's! What does the $1.38 billion bitch-slapping that Standard & Poor's received matter compared to the "looking into" now plaguing Moody's? Why, they might even end up getting a stern "talking to"! And again, please - my saying this doesn't mean I care how Moody's rates anyone's debt. And sorry, neither my world nor my argument will collapse if they themselves end up getting bitch-slapped.

Debt's all, folks said...

The “please don’t misinterpret my previous posts as a sign I care” bit is Standard Trolling Tactic #22. The “when you say it’s me acting that way, that means it’s you!” bit is #14. The “apparently you’re too dense to get my humor, so sad” bit is #5. The “when beaten, declare victory” bit is #26. One more and you get a bingo.

It’s inspiring to hear that your argument is impervious to collapse -- even if and when the feds go after Moody’s for the exact same thing as S&P. The explicit intent of the state and federal investigators is just more useless spin.

"Socialist" said...

You forgot Tactic #7: presenting the truth and watching you dance.

You've been downgraded said...

Yup. From a lying position, looking up into the soles of my feet.