by Joe Shea
August 8, 2011
S&P'S BETRAYAL MUST BE PUNISHED
This downgrading of US creditworthiness makes me mad.
First, S & P are the guys who signed off on all those mortgage bundles as an excellent investment ratings. We know now what happened to those investments. The sorry fact is that the people who were writing the business knew all along they were risky. How is it that the most prestigious financial entity in the world couldn't figure out what every realtor, mortgage broker and mid-level banker knew right at the beginning of the real estate boom?
The people who were approving those "no doc" mortgage applications knew all along that their clients' income could never support the payments, but they were laughing all the way to the bank with their commissions at the stupidity of the banks and the investors who were falling over themselves to buy them - because S&P said they were AAA investments.
What a joke! And these are the guys who can say the most robust economy in the world is not worthy of their highest rating?
There used to be a saying in business before all this attention was being paid to credit ratings: "The banks will never lend you money unless you don't need it." That used to be the determining factor in getting a loan for anything.
The average American knows what it's like to have the threat of a poor credit score hanging over their heads, and they live in dread of not being able to be approved for a credit card. Even cash will not rent a room in a hotel or get you an airline ticket or allow you to rent a car. This financial instrument has become so pervasive that without one you are deemed almost a non-citizen.
You can't even get a movie out of Redbox without one.
I truly believe there is an underlying sinister reason for this downgrade. Somewhere, there is a group of old, grey men who decided they could make more money if this happened. It doesn't matter that they might have more money than most governments. Greed is a huge motivator. This is just another way to squeeze the average guy for more of his meager income. The rich could care less about the number of A's.
What gets me is this only matters if you want to borrow money to live above your means.
The solution is not to borrow money. I read once that it is not the amount of assets you own or the amount of cash you have on hand that matters, it's the amount of money you are owed that is the true benchmark of wealth.
We should tell S & P to stick it where the moon don't shine and make our own deals with anyone who wants to lend us money. We are not about to renege on our debts and we are not a nation of deadbeats. We will make good on our promises. We don't really need it anyway. The American people will do whatever it takes to get through this, with or without a dysfunctional Congress whose childish bickering and posturing is worse than a rerun of "I Love Lucy."
Who cares what these idiots say about our credit rating? We need good jobs and a future for our kids.
We need to strive together to bring back manufacturing and invention and innovation and we need to stop thinking only of ourselves. There is a whole segment of our population out there whose only worry is how to "protect" their money. Like that can really bring happiness.
President Obama's platform back in early 2008 was a program of civic service where our citizens would volunteer and then be repaid with educational and business incentives. We should all stand up and show the world what this country can do.
And the only A's we want are the ones on our kids' report cards.