[quote=threadkiller]I keep hearing this, but exactly which “agencies” are we talking about here? The same ones that got bailed out or overseas agencies?[/quote]
They’re talking about the big 3 credit agencies: Moody’s, S&P, and Fitch. They’re pretty international… They rate everyone’s debt – Japan, Greece, the US…
Not sure about their bailout status – but they were integral in the whole MBS toxic tranches fiasco… so they have some credibility issues. But they still are the only game in town short of doing your own analysis of credit worthiness.
That said… I heard an interview with Bill Gross of Pimco last night on NPR – He said Japan was downgraded by these agencies in 2002, and it didn’t have a big effect on their abilty to get credit. In the current case – as long as we still pay our bills (interest) people will still buy treasuries. A rise in interest rates on treasuries might actually cause folks like Pimco to start buying treasuries again.
