US Credit Rating Downgraded -- Again

[Bison]

Egan-Jones Ratings Co. said Friday it downgraded its U.S. sovereign rating to AA- from AA on concerns that the Fed's new round of quantitative easing, or QE3, will hurt the U.S. economy.

http://www.marketwatch.com/story/egan-jones-downgrades-us-rating-on-qe3-move-2012-09-14

I don't understand the logic of another round of QE, beyond a temporary and artifical reprive from the situation.  It didn't work the first two times.  Why would it work on the third attempt. 

[LongBlade]

I don't understand the logic of another round of QE, beyond a temporary and artifical reprive from the situation.  It didn't work the first two times.  Why would it work on the third attempt.

I knew Moodys was considering a downgrade if a budget deal didn't get done.

This is not good news.

As best I can tell Bernanke is going all-in for Obama. Romney has already made it clear he'd fire Bernanke if he wins, so I guess this is a last-ditch attempt to save Obama's job, thereby saving his own.

[eyebiter]

If Bernanke can just keep things going until after the election, then the currency devaluation can begin in earnest.

[LongBlade]

Egan-Jones Ratings Co. said Friday it downgraded its U.S. sovereign rating to AA- from AA on concerns that the Fed's new round of quantitative easing, or QE3, will hurt the U.S. economy.

http://www.marketwatch.com/story/egan-jones-downgrades-us-rating-on-qe3-move-2012-09-14

I don't understand the logic of another round of QE, beyond a temporary and artifical reprive from the situation.  It didn't work the first two times.  Why would it work on the third attempt.

There are a number of very dark predictions about the impact of this, but here's a good article that lays out the fact that even the brightest picture is not good. This is a dumb move no matter how you look at it. Maybe Bernanke has started smoking crack to feel better, because there's not a good reason to do this.

Concerned about potential negative side effects like inflation, skeptics of current Fed policy paint a much darker picture of the impacts of QE3.

"A best-case scenario is that it doesn't do harm to the economy. I can't really get much better than that," said John Ryding, chief economist at RDQ Economics.

Michelle Girard, senior economist at RBS, echoed that sentiment. "I don't think it'll have much impact. I don't even think the Fed thinks it will have much impact," she said.

Read more: http://www.foxbusiness.com/economy/2012/09/14/even-qe3-best-case-scenario-wont-thrill