During the Great Financial Crisis (GFC) of 07-09 – (some ways seems like an eternity ago…others yesterday – ok, digressing again) Credit Conditions fell apart quickly and with little warning….
The big three Credit Agencies at the time and still today ….Moody’s, Fitch and S&P Global – then called S&P were late to the softening credit cycle and caught a tremendous amount of scrutiny for a lack of warning as Credit Conditions brought a tremendous amount of pressure to the Financial System…
In True Fooled me once like fashion, they are intent on NOT being late to the party this time.
Fitch Threatens Further Downgrades
With Fitch stepping into the credit Downgrade pool first followed quickly by Moody’s, Fitch is back again raising awareness with a symbolic threat to the largest bank in the US, JPMorgan…
Would not be surprised to see the lone silent Agency speak up soon, S&P Global, if for no other reason to save face in case there is a serious weakening….
Bond investors are taking the comments serious and repricing interest rates Higher/Bonds lower values to accommodate higher risk associate with the agency call.
Short term a little headwind on bond values… long term a HUGE advantage in the form of bigger coupons from our Safe Money – NICE!
Oh… Jerome Powell and the rest of his board members on the FOMC (Federal Open Market Committee) have their popcorn out as they happily watch this slowdown occur !
Have a Great “Higher Safe Money Rates” Day!
John A. Kvale CFA, CFP
Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
