The top official behind Standard & Poor’s downgrade of the United States triple A credit rating says his agency is not to blame for August’s stock market slump.
David Beers, S&P’s global head of sovereign ratings, said it’s an “oversimplification” to put the blame on that downgrade.
And he warned developed nations that they still needed to “get their act together” to tackle their mountains of debt.
S&P cut the United States’ prized triple-AAA rating one notch to AA+ on August 5, exacerbating a rout in global stock markets that had already been hit by Europe’s growing sovereign debt crisis and fears of a renewed US recession.
Referring to developed countries in general Beers said: “We’re waiting to see if the governments can get their act together and address both the short-term and long-term issues.” He was speaking at a media roundtable discussion in Singapore.
Beers added that monetary and fiscal tools which could be used to boost sluggish economic growth would be of limited use if households in rich nations continued to focus on reducing their own debt rather than spending.