allan chernoff is in new york. how unexpected is this? >> this is not shocking at all.ally had warned of this on july 14th when they said there was a better than 50% chance they were going to do this. and they've pulled the trigger. it wasn't easy for them but they've done it. what they're saying is that the deal struck this week to avoid default, to raise the debt ceiling and cut spending simply isn't sufficient. it's not enough to stabilize the debt situation of the united states as they term it, as s&p terms it. the medium-term debt dynamics of the u.s. they want to see more spending and they say they're making a judgment on the politics that occurred in washington this past week. the disarray, the fighting, the fact that it took until the very last minute, almost, for them to come to a deal and they're saying we don't believe that the congress and the administration will be able to leverage their agreement into a broader, fiscal consolidation policy so they're giving a thumb's down to what's occurred in washington over the past week. down one notch to double-a plus.

david walker, allan chernoff. ali, for those just joining us and following us and maybe don't know the details of what s&p is all about, just explain why this is important, why this is so bad and what impact this is going to have on folks at home. >> okay, anderson. this was a threat made some time go, both s&p and moody's had warned if the united states doesn't get a handle on its long-term debt situation they could face a downgrade. after the debt deal got made last weekend the credit agencies took a few days and they were in the conversations with the uls treasury to determine what to do. moody's subsequently came out and said the ints will maintain the aaa crediting rating that moody's given it since 1917. the markets are waiting for the other shoe to drop. meanwhile, s&p was looking at the books and it seems like they made a calculation error in how much the u.s.'s deficit will be over the long term. that was pointed out to them by the white house and treasury. despite being found to have made an error s&p is

>> allan chernoff, thank you. >>> meanwhile, it's a pretty dismal week for the u.s. economy.treet this week. get this, the dow has lost nearly 11%, just felicia taylor here with a look at the numbers and what they could mean. >> this past week, there was a tremendous amount of anxiety and uncertainty in the marketplace, and the problem is, we don't know where the growth is going to come from. that's the major question facing investors and tradering around the world. we heard from china that they're now concerned that their own growth rate, which is not hurting at all, but they'll have to hamper it back because the growth rate in the u.s. and in europe is beginning to slow town. and then we heard problems with european banks, whether or not they'll be able to satisfy their debt obligations in the united states, and certainly, we're still concerned about european sovereign debt, and whether countries like greece will be able to satisfy their obligations. all of those concerns are still out there. as far as the u.s., we got some pretty dismal figures on the jobless front, which

allan chernoff, cnn, new york. >>> former president clinton may have had the most powerful job in thewas surviving a heart attack. >> i was lucky i didn't die. of a heart attack. >> yes, he was. can we really be heart-attack proof? sanjay is next with details. run more smoothly by helping remove deposits and cleaning up intake valves. so when you fill up at an exxon or mobil station, you can rest assured we help your engine run more smoothly while leaving behind cleaner emissions. it's how we make gasoline work harder for you. exxon and mobil. excuse me? my grandfather was born in this village. [ automated voice speaks foreign language ] [ male announcer ] in here, everyone speaks the same language. ♪ in here, forklifts drive themselves. no, he doesn't have it. yeah, we'll look on that. [ male announcer ] in here, friends leave you messages written in the air. that's it right there. [ male announcer ] it's the at&t network. and what's possible in here is almost impossible to say. aren't getting enough whole grain. but actually, it's never been easier to get the whole grain you want fr

allan chernoff, cnn, new york. >>> 34 minutes past the hour now. be honest with me right now.ld you really give up billions of dollars to marry the person you love? seriously? be honest. we've got a story for you coming up about european royalty that has sparked that conversation. you need to hear this one. stay with me.oh we call it the bundler. let's say you need home and auto insurance. you give us your information once, online... [ whirring and beeping ] [ ding! ] and we give you a discount on both. sort of like two in one. how did you guys think of that? it just came to us. what? bundling and saving made easy. now, that's progressive. call or click today. energy is being produced to power our lives. while energy developement comes with some risk, north america's natural gas producers are committed to safely and responsibly providing decades of cleaner burning energy for our country, drilling thousands of feet below fresh water sources within self contained well systems and using state of the art monitoring technologies, rigorous practices help ensure our operations are sa

cnn's allan chernoff found out that such government goofups can very easily happen to you too. >> reportsat quote attributed to mark twain certainly applies to thousands of social security recipients every year, including one elderly woman who we met who received some very untimely news from the social security administration. marjorie louer is a healthy and vibrant 94-year-old, yet the social security administration thought she died five years ago. you look very much alive to me. >> i feel alive now. but at one time i didn't. >> was that because of what the social security administration told you? >> yes, exactly. yes. in fact, one young clerk looked me in the face and told me i was dead and i said, but i'm standing right here. >> reporter: marjorie went to her local bank to get some cash. but her atm card wouldn't work. when she went inside, a bank officer cut the card up right in front of her and said according to our records, you're dead. >> and i explained to her, well, i didn't feel dead but she insisted i was. >> reporter: to your face? >> to my face. >> reporter: someone inside th

cnn senior correspondent allan chernoff on the phone and on the phone is poppy harlow, i want to go to the magic wall so people can visualize this at home. if standard & poor's were to take us, the united states government, down from extremely strong to, say, aa, very strong, all of these, of course, the lower ratings. we assume if they went down, it would be just a notch. what would the impact be on the government and what might the impact be on the consumer? >> absolutely, john. i have two words for it, unprecedented and uncharted. those are not my words, those are what a new york stock exchange trader told me after the market closed today. that's the fear heading into monday's session. if we have a downgrade from s&p, that is what traders not only in the united states and investors, the average americans and people all around the world are concerned about. that is -- that is what sustaining this fear heading into monday's session. we'll get a first indication of if we do have a downgrade on sunday night. we'll see how the asian markets react when they open at 8:00 p.m. eastern on su

senior correspondent allan chernoff reports the announcement came as no surprise. >> this is not shocking all. it is shocking from a public relations standpoint, but s&p actuallied thy ed thahad warnedk on july 14th when they said there was a better than 50% chance that they were going to do this and they pulled the trigger. it wasn't easy for them, but they've done it. what they're saying here is that the deal struck this week to avoid default, to raise the debt ceiling and cut spending simply isn't sufficient. it's not enough to stabilize the debt situation of the united states and they're also saying, they're making a judgment here on the politics that occurred in washington this past week. the disarray, the fighting, the fact that it took until the very last minute, almost, for them to come to a deal and they're saying we just don't believe that the congress and the administration will be able to leverage their agreement into a broader fiscal consolidation policy. so they're just giving a thumbs down to what's occurred over the past week in washington. it's certainly possible that som

>> all right, allan chernoff, with thanks so much. >>> well, the republican presidential hopefuls aredowngrade. from mitt romney, he says -- "america's creditworthiness just became the latest casualty in president obama's failed record of leadership on the economy. standard & poor's rating downgrade is a deeply troubling indicator of our country's decline under president obama." here's what minnesota's michele bachmann had to say -- "i call on the president to seek the immediate resignation of treasury secretary timothy geithner and to submit a plan with a list of cuts to balance the budget this year, turn our economy around, and put americans back to work." the s&p downgrade just the latest blow on the economic and political front this week. potential voters not happy. according to a cnn orc poll conducted after the debt deal was announced, americans say 77% of elected officials who dealt with the debt ceiling acted like spoiled children. as you might imagine, those polled don't think much of the job congress is doing. according to the cnn orc poll, 84% say they disapprove of the job

our allan chernoff. >> reporter: that quote applies to thousands every year.an we met who receives some untimely news from the social security administration. margery is a healthy 94-year-old. the social security administration thought she died four years ago. >> you look very much alive to me. >> i feel alive now, but at one time i didn't. >> reporter: was that because of what the social security administration told you? >> yes, exactly. in fact, one clerk looked me in the face and told me i was dead. i said i'm standing here. >> reporter: she went to the bank to get cash, but her atm card would not work. a bank officer cut the card up in front of her and said an according to our records, you're dead. >> i said i did not feel dead, but she insisted i was. >> reporter: to your face? >> yes. >> reporter: someone inside the social security administration had accidentally typed an incorrect digit while recording the number of a person who had recently died. leading the computers to believe margery was the decedant. when someone is deceased, the social security nu

allan chernoff, cnn, new york. >>> elvis fans gathering at graceland to remember the king.is morning off presley's grave to mark the 34th anniversary of his death. elvis died in his memphis, tennessee, mansion on this day back in 1977. >> i remember it well. >> me too. i remember -- >> sad day. >> who's elvis? that's what i said. >> right. >> little young. >> the young elvis or old -- >> i know you remember kiss. >> i do. the rock band joining the lineup for the michael jackson tribute concert in wales in october. that has many jackson fans upset. kiss frontman gene simmons made some negative comments about the late pop star back in 2009. some jackson supporters say they won't be going to the concert. >>> all right. say it ain't so, tlc canceled "kate plus 8" featuring kate gosselin and her broad of eight children. the show began as "john and kate plus 8" and then more of its current form after their divorce. the show's final episode will air september 12th. what will you do with that time? >> i can think of a few things. >>> it's 44 minutes past the hour. we'll check the d

here is our senior correspondent allan chernoff. >> a growing number of americans are starting their careers deeply in debt as a result of the money they had to bar row to pay for education. for many education loans have become a de facto mortgage that could take decades to pay off. rebecca belante has made it to new york city working in fashion for retail giant j. crew. >> accomplished, definitely, a very good word to describe how i feel. >> reporter: accomplishing her dream has been costly. to earn her masters in fashion design at drexler university she had to take on student loans from the federal government and private lenders, even with help from her parents, the three-year program left her with debt approaching six figures. >> i have some really dark moments about it for sure. it's overwhelming, extreme, a lot of money and i have to try to ultimately stay positive to know that i will get through it and i will make it work. >> reporter: the working world often requires ambitious, responsible americans like rebecca to assume mountains of debt to gain the education their careers d

allan chernoff has been working the story for us. what are you finding out?> the fact is that these investigations have been underway well before s&p's recent downgrade of the united states. sources confirmed to cnn that the department of justice and the secures and exchange commission have been digging in to the inner workings of the nation's largest credit agency standard & poor's and moody's, focusing on their failure to fail to assess the risk of mortgage securities. s&p and moody's are targets of federal investigations into more ganlg securities that went shower during the financial crisis. according to sources familiar with the inquiry, attorneys from the department of justice and the securities and exchange commission have been digging into the rating agency's method onle gi, in particular, did executives veto credit analyst efforts to downgrade ratings so as not to lose business on the issuers of securities who are paying to berated. >> the credit rating agencies fail spectacularly in the years leading up to the financial crisis. >> reporter: the rati

allan chernoff is here with me in new york. he's been looking at that. the good news is that it's been cheap, it's been cheaper in the last few months to get a mortgage. the place where the mortgages are financed, at least today, didn't become more expensive. >> ali, this is one fear that's not being realized in the marketplace today. the downgrading of fannie may and freddie mac led to worries that mortgage rates could shoot up. but what we're seeing today in the marketplace is actually the opposite is happening. now, fannie may and freddie mac are extremely important. the government sponsored entities buy mortgages from banks and thereby allow the banks to receive more cash to make more mortgages. they're essential. you would think that mortgage rates would shoot up. but a more important factor is happening right now. that rush into treasury bonds, into treasury securities. keep in mind, the mortgage rate, the 30-year fixed mortgage rate is tied to the ten-year rate. we've got a graphic here. have a look at this. i'm calling the treasury bonds essentia