By Jordan Myers
You don’t have to be an investment guru or savvy Wall Street investor to have heard S&P or S&P 500. The chances are, though, that you probably don’t know much about what that means. S&P stands for Standard & Poor’s, which is a United States-based financial services company. It is well known for its stock market indices domestically and abroad. An example of such is the S&P 500, which is a collection of 500 “large-cap” common stocks. Typically a “large-cap” stock is that of a publicly traded company whose market capitalization is between 10 and 100 billion dollars approximately.
Standard & Poor’s is one of the “Big Three” credit rating agencies along with Moody’s Investor Service and Fitch’s Ratings. If you have been following the news, then you know that earlier this month Standard & Poor’s downgraded the United States debt rating for the first time in history. This downgrade occurred surrounding the impasse that was presented around the resolve of the issues with the nation’s debt ceiling. Some experts are claiming that there could be a rise in mortgage and home equity lines of credit interest rates being that these rates are usually pegged on Treasury Bonds. There are many speculations but at this time no one knows for certain the implications that will come along with the reduction in the nation’s debt rating.
The silver lining to the cloud is that, although Standard and Poor’s downgraded the US debt rating from the highest possible AAA rating to AA+, Moody’s and Fitch both have kept the nation at a AAA rating. Many investors, and consumers, are clinging to the hope that legislation will be enacted to reduce government spending, lessen the burden of the national deficit, and return the nation’s debt rating to where it once was to prevent any further imposition on the consumer.
Although this isn’t an illustration of a disaster affecting the elder community exclusively, it is surely an example of how a lack of planning can orchestrate a grave disaster. Maybe the government should have started earlier to get their ducks in a row, rather than later!