By John Galt
August 5, 2011 21:31 ET
Agencies Issue Guidance on Federal Debt
Earlier today, Standard & Poor’s rating agency lowered the long-term rating of the U.S. government and federal agencies from AAA to AA . With regard to this action, the federal banking agencies are providing the following guidance to banks, savings associations, credit unions, and bank and savings and loan holding companies (collectively, banking organizations).
For risk-based capital purposes, the risk weights for Treasury securities and other securities issued or guaranteed by the U.S. government, government agencies, and government-sponsored entities will not change. The treatment of Treasury securities and other securities issued or guaranteed by the U.S. government, government agencies, and government-sponsored entities under other federal banking agency regulations, including, for example, the Federal Reserve Board’s Regulation W, will also be unaffected.
READ AT:
http://www.federalreserve.gov/newsevents/press/bcreg/20110805a.htm
Probably true for the short run. I’m not sure how happy I’d be to get my money back and it won’t buy as much as when I bought in, though.
And at the rate TPTB are going, I really doubt I’d buy 10-year or 30-year paper.