Notes From Underground

I wish to leave everyone with this great quote from a person I have little respect for but this quote is very apropos following the release from S&P this morning, which slashed the U.S. credit outlook to negative from stable. (It’s AAA-rating is still intact.) James Carville said:

“I used to think if there was reincarnation, I wanted to come back as the president or the pope or a .400 baseball hitter. But now I want to come back as the BOND MARKET. YOU CAN INTIMIDATE EVERYBODY.”

The quote is great for it captures the real power of the BOND VIGILANTES. A question also arises about the role of the rating agencies and the “anti-trust exemption” they enjoy from the grace of Congress. It must be remembered that CONGRESS has legislative oversight so IS IT IN THE INTEREST OF THE RATERS TO FALL AFOUL OF ITS LIFE GIVERS? Isn’t this similar to the famed ANTI-TRUST EXEMPTION OF BASEBALL, only in this regard we are dealing with a FLOOD OF DEBT? Again, happy holidays to all of the readers of NOTES FROM UNDERGROUND — YRA HARRIS

Tags: bond market, bond vigilantes, Congress, Debt, James Carville, S&P, U.S.

This entry was posted on April 18, 2011 at 9:19 am and is filed under Debt Market, United States. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.