Los Angeles City Officials Quit S&P Rating Service After Bond Downgrade (Payback's a Bitch)
The city of L.A. booted its bond-rating service after S&P gave us another downgrade recently. Its one of three cities that have done so in the wake of S&P giving even the old United States of America a downgrade.
City Hall dumps S&P.
The Bond Buyer broke the news today. L.A. has $7 billion worth of debt that's rated by S&P. (Added: Oops. Rick Orlov at the Daily News had this light years ago).
L.A. chief investment officer Thomas Suarez told TBB:
Quite frankly, we just don't want to be associated with [Standard & Poor's] anymore based on that decision. We think it was irresponsible and just excessive.
L.A. was taken from AAAf to AAf last week, about the time the U.S. was downgraded from AA-plus from AAA.
That wouldn't be so bad, but S&P was one of the rating agencies that stood by with top grades as Wall Street invested in junk real estate loans and related "tools." (And "tool" is a key word here).
And you know where that got us: Great Recession. (It lives).
Payback's a bitch, even on Wall Street.
[@dennisjromero/djromero@laweekly.com]
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