S&P also lowers Illinois’ ratings
Thursday, Jun 9, 2016 - Posted by Rich Miller
* Oy…
S&P Global Ratings downgraded Illinois’s ratings a notch, citing the state’s weakened financial management and budget position, while rival Fitch Ratings placed the state’s ratings under review for a potential downgrade.
S&P lowered the ratings on Illinois’s general-obligation bonds to triple-B-plus from double-A-minus. The new rating is three levels above junk territory and carries a negative outlook.
S&P said that the state’s continuing lack of a budget plan has left Illinois “with unmanaged spending under a de facto budget, potentially for a second year, and that is adding to the state’s sizable liabilities.”
Fitch, meanwhile, also placed the state’s $550 million bond issue that is expected to sell June 16 on ratings watch negative and rated it at triple-B-plus, or three notches above junk territory. Fitch says it expects to make a decision on the rating with six months, based on the progress of the state’s budget process.
I’m hoping nobody feels the need to revise their numerous press releases from the Moody’s downgrade. My brother and my niece are coming over soon.
- Keyrock - Thursday, Jun 9, 16 @ 4:49 pm:
Governor Rauner: “Excellent!”
- 47th Ward - Thursday, Jun 9, 16 @ 4:51 pm:
#winning
- Hit or Miss - Thursday, Jun 9, 16 @ 4:51 pm:
I wonder how much more, in dollars and cents, this will cost Illinois tax payers in interest costs on the $550 million bond sale?
- Honeybear - Thursday, Jun 9, 16 @ 4:53 pm:
Family time sounds good. What are fixing? I much rather talk about that then another downgrade!
- burbanite - Thursday, Jun 9, 16 @ 4:56 pm:
Before or after the 11 a.m. press conference?
- cdog - Thursday, Jun 9, 16 @ 4:58 pm:
Let’s do a little QE Illinois style.
Why not buy our own bonds? Start the printing press!
- Unbelievable - Thursday, Jun 9, 16 @ 5:01 pm:
Rauner and legislators can play the blame game all they want. But let’s remember that voters picked this “business-savvy” venture capitalist as their Governor: the one who told his investor buddies not to invest in IL. Whether he wants to blame it on the GA is one thing. But he went out in public to admonish my state in the press when he should be promoting us! I suppose that’s good business acumen if you’re trying to drive prices down so “someone” and his friends get to pick up the pieces of IL for chump change when it collapses…hmm…maybe he’s using the only business savvy he knows. Rauner: IL’s Venture-in-Chief.
Just remember this is our leader…
Rauner said bond investors “might have to be thoughtful and actually do work, actually assess risk and reward.”
As a rare U.S. governor with Wall Street experience, Rauner has a unique perspective on debt. For now, he may be focused on his immediate budget predicament, but bond buyers everywhere can consider themselves forewarned. http://blogs.reuters.com/breakingviews/2016/05/17/illinois-governor-all-but-summons-bond-vigilantes/
- AnonymousOne - Thursday, Jun 9, 16 @ 5:06 pm:
First thought is how much more debt we’ll be deliberately plunging ahead into. Other thought, this is really good news for wealthy investors like our governor. Did someone say vulture capitalist? Too bad actual human lives are being so destroyed for the profits of some.
- Macbeth - Thursday, Jun 9, 16 @ 5:06 pm:
Rauner doesn’t care. This is what he wants, right?
Rauner: “It doesn’t matter. Madigan! Cullterton!”
- Macbeth - Thursday, Jun 9, 16 @ 5:07 pm:
BTW — I’m waiting for the businessman governor we elected to actually … well, actually do some business as governor.
Where is this businessman governor?
- Dee - Thursday, Jun 9, 16 @ 5:07 pm:
Can the issuance be covered by TARP?
- AC - Thursday, Jun 9, 16 @ 5:24 pm:
A pessimist would get depressed about the poor prospects of an end to the credit damaging impasse. An optimist would be hopeful that guidance from the ratings agencies would help spur much needed action. A wealthy opportunist would make a fortune in the bond markets.
- Wensicia - Thursday, Jun 9, 16 @ 5:27 pm:
“I’ve been successful at everything I’ve ever done,”
Is this how Rauner views success?
- wordslinger - Thursday, Jun 9, 16 @ 5:30 pm:
Meh, one rating agency moves, then the other two join in.
- Norseman - Thursday, Jun 9, 16 @ 5:30 pm:
Rich, save yourself time and use the following:
Responses - Ditto.
Enjoy your company.
- Turtleneck - Thursday, Jun 9, 16 @ 6:23 pm:
I’m with Honeybear, I’d rather hear about what’s going on at the Miller residence tonight rather than another downgrade.
Downgrades come and go (a lot, lately). Hope you get to roast some marshmallows!
- Winnin' - Thursday, Jun 9, 16 @ 6:28 pm:
Topic of Rauner’s staff dinner meeting tonight:
Who moved my cheese?
- park - Thursday, Jun 9, 16 @ 6:32 pm:
Time for Mr. Madigan to stop standing with his arms crossed and play hardball on a deal. No more waiting it out like with Blago. He’s supposed to be good, now get something DONE.
- Huh? - Thursday, Jun 9, 16 @ 7:33 pm:
“Topic of Rauner’s staff dinner meeting tonight: How to spin this as Madigan’s fault?”
Fixed it for you.
- Siriusly - Thursday, Jun 9, 16 @ 9:58 pm:
hit or miss - someone told me the cost difference to the state on this bond issue could be anywhere $10 to $60 M
- anon - Friday, Jun 10, 16 @ 5:21 am:
Same o Same o