The actual report released Monday early morning says that the United States has a big debt and deficit in contrast to other highly rated nations, and in contrast to with those other countries "the path to addressing the debt as well as deficit is not clear to all of us."
They're right, of course even when a little late. The only astonishing thing is that S&P made the call whatsoever. Ratings agencies are infamously behind the curve. Anyone who comes after these things knows America is actually in quite a pickle.
Therefore why now? Just last week the US Senate condemned Standard and Poors and other rating companies in a report on the financial crisis. The actual ratings agencies weakened their own standards as each competed in order to provide the most favorable rating in order to win business and greater share of the market. The outcome was a battle to the bottom.
Reduced ratings “reflected the unprecedented degeneration in credit quality, but were not a contributing factor to it,” Catherine Mathis, an S&P spokeswoman, stated in an e-mail response to Levin’s findings. “We feel disappointed about that, like many others, we didn't foresee the speed and degree of the housing downturn, which was the actual steepest decline since the Great Depression.”