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Right now we're gonna go to Charlie Gasparino Charlie of course is a veteran market watcher written books on Wall Street has been watching this for a long time.
Analyzing these companies and Charlie are you there do we have you now.
You -- I never -- -- be covering the US stable and strip where it struck -- rating.
From the terrace club restaurant is a affect your -- right now.
Well how that's the way it happens surely come -- you make of this story.
Our is you know authorized.
Doubt not at all I mean I've been saying all week it was at 80% chance they're going to downgrade -- I think you're gonna do it now.
I'm not until today here's what I thought they're gonna do today if you look at the initial reports are it was ABC news broke the story.
Which broke the story were citing government source now I covered the -- -- -- many years.
Our we were at the Fox Business -- putting all day and all morning and all day it'd be treasury at Citi -- -- -- getting nothing back so they clearly weren't in -- Geithner what I had -- -- Geithner the Treasury Secretary which in negotiations with with as the be all all day so we're.
-- -- -- -- -- but He is a think what you site government sources what does that mean.
-- attributed been a big but generally.
This is how rating downgrades go.
Be short been in the US or whether it's -- bond issuer like a -- I could I could company York or municipality if given -- released by escapee.
And they stated.
They talk about the language -- And I'll tell you what you heard initial -- about citing government sources it really did appear that the -- treasury was given.
Notice official notice that they were downgraded because that's where the leak -- comp comp.
-- what do I think is gonna happen but should be mr.
-- -- huge event you'll follow administration has lost beat USA AAA rate there is no way.
They could talk a rabbit they might wanna blame it on the Republican for being intransigent about revenue increases.
Okay but it -- are -- a matter we.
Spent a lot of money over the past year.
Are we to the stimulus program -- failed.
Be dealt PO but it up revenues declined actually -- massive deficit and I'm that the president's watch crop political employed he'd lost triple A rating and this is an historic -- -- -- Total market period there standpoint I don't know if I spoke all they would Wall Street executives senior people at major banks.
And they think the market -- going to be muted why is that well it's really a split -- booties.
Pitched maintain the triple -- okay.
-- -- I don't know your opinion on this and we get your opinion on this treasury seems to be fighting back tears saying that the analysis that SMP as -- this faulty it doesn't make sense.
If -- even way back up.
-- went back and even you know re ran it's numbers made changes to its numbers but kept the rating.
-- did -- get them anywhere.
No they also say that I -- -- a new.
But New York City lost its operating -- covered that back in the mid 1990s.
Every municipality that I held up then this is.
As supposed to accompany right USA is that it's a largest municipality.
They always say they're rating -- lost you know that the numbers and the numbers they get -- -- I don't think that that -- was in the -- artists equity put a marker based at fort trillion dollars.
Oh carts he'd be done state triple -- based that it they came up but it -- they came well short of that.
I don't think -- the debt deal you know -- -- at least.
You know they've made some progress are cutting back up but rob Bartlett SMP put itself in a box I will tell you -- And that's why so that it was -- 80% chance of being downgraded because they put -- some of the -- are saying they did the right thing.
I'm saying that you do based on what they stared at what they're parameters worked.
Get credit downgrade I don't sort of be later but update today when -- -- those were those that story had a baby seat that was government sources.
On tell you my nose.
I still inflows the fact that they were given the first release they were essentially -- stuck.
Surely tell me what happens Monday morning.
When the market.
Outlets -- we could see a big sell -- we -- on to point out decline.
You know Richard this is a market that -- hugest liquid I just don't think promote but what we from a market standpoint -- -- matter.
We can get what you're if you want educated you are putting ChinesePod.
You're -- if you wish they'd bought I don't care.
There are a lot of people out there who actually say that the US treasury bond should have been downgraded a long time ago.
They -- triple -- credit they don't deserve that credit rating and it should have been changed sometime.
Well I don't know about that but I will status was producing balanced six months -- Not that much actually it's better now take at least -- try to get their credit but you know there's two issues here Jerry there's a political issue.
Bit of market -- I think the market I think the stock market so a little bit but who knows how much I mean it could be muted.
They have a whole week that was one of the things that was pictures and hear what people Nortel -- Wall Street is that.
The reason what it thought it might downgrade of state because they got the we get the treasury -- execute contribute a week and it's been the story.
To prevent the market could collapse that's which -- gonna see -- built sort of extricate.
But there's also a political story here.
There's the political story that this president.
And he's gonna try to -- this congress.
-- AAA I don't think the congress staying works because.
Take a look -- what I understand it's very.
You know it wasn't John Boehner it you know fortunately I don't care you know this is not a political statement Barack Obama what economic to work.
And word it we're gonna -- right.
We've had spending for a long time and I have to ask you as you look at this does this give put a fire.
Under congress is to put a fire under the White House to get the spending under control things happen now that wouldn't have happened say last week.
Depends on the market reaction might view is that.
My view is that the market reaction you know -- -- -- I mean I think market I mean bond market that the stock market they trade off on the on the on the -- you know that's possible and told what the bond market.
All peoples continue to buy treasuries and state a bit.
You know I just don't see anything out there that is good you know to say it -- so treasury trader as they -- been.
It doesn't matter which at the bottom why does it look you got to -- -- not -- get.
Sort of concerted effort to do massive spending cuts or you know lower taxes or huge huge huge stimulus unless you have government -- Got the -- right you have everybody -- -- -- the players who want to -- then you get a sort of coherent effort right now we we have incoherent.
Fiscal policy and when that happened you know it -- up like this.
That's why you get you had kind of a deal that was sort of get stake because you're in -- -- get to park.
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