Moody’s Reaction to US Downgrade

In his first comments after the move by rival rating agency S&P, Moody’s analyst Steven Hess sounded a note of caution about Moody’s rating of the US, repeating that the August 2 plan to cut deficits by $2.1 trillion was positive for the US credit standing, but not enough to keep its rating on a stable outlook.

He was quoted as saying in Reuters interview as “”If the process for further deficit reduction that is included in the budget control act produces results that are not really credible, that combined with the economic performance could potentially cause an early move on the rating,”

News on unemployment benefits

Nearly a million people have lost their unemployment benefits because the Senate failed for the third time Thursday to extend the deadline to file for this safety net.

Hoping to overcome deficit concerns, the Senate trimmed down the bill yet again on Wednesday night so that it would only increase the deficit by $33.3 billion over 10 years, instead of $55.1 billion. The main changes were to scale back additional Medicaid funding for the states and to reallocate some stimulus and Defense Department spending.

This is really disturbing news for some. We’ll do a follow-up article reagarding this topic.