The Spectacle Blog

Further Downgrades Don’t fit the Narrative

By on 8.8.11 | 12:24PM

Standard & Poors downgraded the United States' credit rating and the left claims it's because of the Tea Party and its alleged intransigence after focusing on one aspect of Standard & Poor's explanation. But how do you blame the Tea Party for downgrades in further institutions not having anything to do with alleged Tea-Party-partisanship?  The story (here):

Meanwhile, S&P downgraded government-sponsored enterprises Fannie Mae and Freddie Mac to AA+ from triple-A, with S&P citing their reliance on U.S. government.

Ten of the country's 12 Federal Home Loan Banks were also cut to AA-plus. The banks of Chicago and Seattle had already been downgraded earlier to AA+.

Fannie and Freddie own or guarantee about half of all U.S. mortgages, or nearly 31 million home loans worth more than $5 trillion. As part of a nationalized system, they account for nearly all new mortgage loans. Their downgrade might force anyone looking to buy a home to pay higher mortgage rates.

S&P also cut ratings for several of the main arteries of the US financial system -- the Depository Trust Co., National Securities Clearing Corp., Fixed Income Clearing Corp. and the Options Clearing Corp. -- were cut one notch to AA-plus.

Clearly the left needs to update the tired narrative before its Credibility Rating plummets to outright calumny. 

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