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Haitian Companies Still Sidelined from Reconstruction ContractsCEPR / April 19, 2011
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Letter to Sen. Durbin Over Social Security Comments on ABC NewsDean Baker / April 19, 2011
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Trapped?John Schmitt / April 19, 2011
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The Washington Post Has Different Definitions of "Too Much" for Public Workers and Wealthy PeopleDean Baker / April 19, 2011
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S&P's Warning on U.S. Debt Prompts Another Front Page Washington Post EditorialDean Baker / April 19, 2011
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Questions for S&P on Its Potential Downgrade of U.S. DebtS&P managed to capture the headlines yesterday when it announced that it had a negative outlook for the credit rating of the United States. After all, an actual credit downgrade for the United States government would be big news. While the immediate response was a boost to the deficit hawks’ efforts to cut programs like Social Security and Medicare, it is worth asking a few questions before we surrender these programs to the Wall Street numbers mavens.
The last time S&P was in the headlines it was for giving investment grade ratings to hundreds of billions of dollars of securities that were backed by subprime and ALT-A mortgages. These mortgages were used to buy over-priced homes at the peak of the housing bubble. Many of these mortgages not only carried high risks, but were fraudulent, with lenders having filled in false information to allow homebuyers to qualify for loans that their assets and income would not justify.
Serious people should ask what S&P has done to improve its ratings systems. Have they changed their procedures? Did the S&P analysts who gave AAA or other investment grade ratings to toxic junk get fired or at least get demoted? If not, should we assume that S&P used the same care in assigning a negative outlook to U.S. government debt as it did in assigning investment grade ratings to toxic assets?
Of course it was not just bad mortgage debt that stumped the S&P gang. It gave top quality investment grade ratings to Lehman until just before it imploded in the largest bankruptcy in history. The same was true of AIG, which would have faced a similar fate without a government rescue. Bear Stearns also had a top rating until the very end, as did Enron. In short, S&P has a quite a track record in missing the boat when it comes to assessing creditworthiness.
CEPR / April 19, 2011
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IMF’s Rhetoric Still Far from Its PoliciesMark Weisbrot / April 18, 2011
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Representative Ryan Makes a Clear CaseDean Baker
Truthout, April 18, 2011
Dean Baker / April 18, 2011
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Tyranny of the Central BankersDean Baker
International Relations and Security Network, April 18, 2011
Dean Baker / April 18, 2011
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If a Negative S&P Outlook for the U.S. Explains a Drop in Stock Prices, Why Did the Dollar Rise and Interest Rates FallDean Baker / April 18, 2011
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Douthat Makes It Up On Median Family Income (see note at bottom)Dean Baker / April 18, 2011
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The Battle Is About Giving More Money to Rich People, Not About the Size and Role of GovernmentDean Baker / April 17, 2011
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Raising Reserve Requirements to Slow Inflation: China Shows How It is DoneDean Baker / April 17, 2011
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Why Is It a Problem if Poor People Increase Their Consumption?Dean Baker / April 17, 2011
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Medicare Costs More Under Ryan Plan and the Iraq War Costs More Than a HamburgerDean Baker / April 16, 2011
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Debt and Interest Rates: Isn't There a Bond Market in the United States?Dean Baker / April 16, 2011
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Labor Market Policy Research Reports, April 11 – 15, 2011CEPR and / April 15, 2011
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Turning the Page: Are Developing Countries Bouncing Back from 20 Years of Stagnation?Rebecca Ray / April 15, 2011