Apparently, the bond market doesn't think S&P knows what it is talking about.

[BzaDem]

Today, after the S&P announcement about the "downgrade" in our "outlook" -- the interest rate on the 30 year treasury went DOWN -- from its already near-record-low over the course of several decades.

http://finance.yahoo.com/q?s=^TYX">30 year rate

Perhaps their warning is more about politics (and specifically getting the deficit cutting prescriptions they favor), rather than about our finances.

[The Magistrate]

1. Indeed, Ma'am: These Shit-Heels Are Simply Trying A Political Play

If this administration was truely on the ball, I.R.S. audits of members of the S & P board membership and upper management, and F.B.I. investigations of every stock trade and business venture they had engaged in for the last seven years, would aready be underway....

[The Second Stone]

2. US Treasuries are what the entire world economy relies on

to be the standard. Where do those hundreds of billions go if treasuries are not reliable? This is the same S & P that said the mortgage derivatives were just fine. Not only do they not know what they are talking about, but this evaluation, as well as the mortgage derivatives evaluation indicate that it is the interests of the ultra wealthy Wall Street bankers that are using these ratings to drive a political agenda, not evaluate securities. These US treasury securities are more reliable than any other investment in the world historically and by the very nature of the market. If this nation continues to go down the path of destroying the middle class, that will wreck the USA. Tax the wealthy and corporations at the same rate as the middle class and poor and the economy will follow.

[99th_Monkey]

4. Ding! Ding! Yes.> "This is the same S & P that said the mortgage derivatives were just fine?" ~nt

[flamingdem]

3. Ed Shultz did an analysis of this and it looks like politics nt

[Name removed]

5. Deleted message

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[BzaDem]

7. The Fed is buying very few (if any) 30 year Treasuries.

90% of QE2 bond purchases are for maturities 10 years or less.

[Name removed]

9. Deleted message

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[girl gone mad]

6. Obama should have crushed them when he had the chance.

Instead, he empowered them.

Whose idea was that?

[BzaDem]

8. I don't think the solution is to ban criticism of our fiscal picture. n/t

[sudopod]

10. There's a whole spectrum of action between "banning" and "nothing". nt

[tkmorris]

13. S&P isn't engaging in criticism

They are attempting to influence fiscal policy through extortion.

[upi402]

11. That was my gut on it

Scare the plebes into supporting tax cuts for the rich on the backs of the desperate.

[Capitalocracy]

12. It's like they just found out

what everybody knows

[mmonk]

14. Politics is playing into it of course.