Does Moody’s issue issue?

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On Friday, Moody’s pulled the trigger and Undressed the US latest rating the last – A notching from AAA to AA1.

But it is important?

Our viewed the effects of a discount A few months ago, Moody’s still seemed to be in determination to ignore sixty-leg blinking neon board to write to the wall.

Who knows the prospects of the stock market? When trading is opened on Monday, no matter how much or not. Of course, the SOFUS subverse in August 2011 in August 2011, US fund prices (after the end) have been the worst day to fall since the global financial crisis. But the market quickly recovered. There were people what the discount could mean for financial plumbing.

So this time do you have a discount for financial plumbers? The response from a mechanic point of view is almost “not generally”.

It is impossible for banks to affect the rating change of calculations at risk. The reason for this, regulators do not include difference between AAA and AA1 while determining the weight of capital risk. For example, this is the case BIS comes out The standard approach for credit risk is as applied to individual claims to calculate risk-based assets in relation to sovereigns:

Moody’s, I could make three copies from AAA from AAA – and nothing could change on this front.

How about collateral management? One Note from Barclays Friday night looked at the effects:

For collateral purposes, the discount for AA1 cannot be affected. For example, DTCC and Cme Look at the active class like US treasures and a hairstyle is a function of adulthood and security type (tips / frns), but not ratings. Horse LcchA discount to AA1 is unlikely to cause a change. For example, Usts and Gilts have similar hair fixes as the last low assessment.

In addition, they believe that actions will not trigger movements at the short end of the movement:

The financial crisis has reduced the use of open rules in investment mandates.

Thus, Creasury and Treasury Repo do not expect the waves of active sales in Creasury and Treasury Repo.

Discount for themselves can result from financial markets, and the discount may be given good results for themselves. S & P Global Ratings will work in 2011, the firm will be for a rough ride. Tim Geithner threw the US Treasury Secretary of the US Treasury after ten years of S & P A little open peopleand director Michael Moore called to Obama arrest the CEO of the Company. Like We wrote In March:

Someone hired a plane dragging the rating agency’s offices, which announces the rating agency’s departments, and stopped working with a group of local governments.

Meanwhile and probably unexpected, the Department of Justice began investigation S & p. There was CEO Deven Sharma for a few weeks The company has left. When things come from being just an investigation $ 5 billion federal claim The S & P claimed that the reliability of the ratings before the 2008 financial crisis, the S & P, who was reportedly miscalcated, took this direct revenge.

After Downgrade, Moritz Kraemer – Sovereign Ratings in S & P Global Rating of Sovereign Ratings – Wrote in LinkedIn said the danger of revenge is real:

Rating agencies in the United States are regulated and licensed by the SEC (Securities and Exchange Commission). As we stop in America today, we must think that SEC can move independently of the desires of the White House. Remember that the previous SEC chairman Gary Gensler, in the opening day, Trump Acolyte paved. Trump will say the United States’ decline (undoubtedly will be individualized), the pound will be retribution and vengeance.

We have already rejected the analysis of the White House and Marky’s chief economist has seen that in Mark Zandi. Presidential Assistant Steven Cheung, tweeted: “Nobody burns’ the ‘analysis’ seriously. He has been proven in the wrong time and time again. “

Like based on substantialZandi was not the author of this report and was not working for Moody’s Analytics, which is a separate part of the company that is not part of the rating work.

More generally, a notch discount from AAA may not be very large market results.

Fisly, Moody’s predicted basket-working measurements for a long time for the United States. In March, he once again approved the AAA rating, he wrote that the country’s AAA rankings are based on the country’s “unique and central roles of the Dollar and Treasury Bond market in the global finance.

In the previous ranking report, the AAA rated in November 2023, Moody’s wrote:

The weakening of institutions and management capacity as money and macroeconomic policy effectiveness or the deterioration of lawsuits and judicial bodies can also aggravate the rating.

The world has been acting since 2023 and is the market for Moody’s market.