can you explain your concern with moody's in particular. >> it's moody's and standard & poor's.oody's got issued a threat to downgrade triple rated and steven townsend, massachusetts, never defaulted, well funded, no chance of default. few entities in our economy were as culpable as moody's and standard & poor's for the down turn that we just went through. because they told people, it's triple. and no defense for them. they way overrated. >> neil: no doubt about it. the only rating game in town. >> well, what do we do? we don't pay as much attention to them. in a bipartisan way, the market is down. you asked me what to do. and what the markets do, part of what you want to try to do is to change things, now, the government is in part responsible for the overrating of the rating agencies. because we had until last year, a requirement that people use the rating agencies. >> we required people to pay attention to entities that were totally misleading people. what we did in the bill last year, this part testify bipartisan and virtually, we told the federal government do not require a

moody's see significant risk in greece. >> let us look at the market numbers. in frankfurt, the benchmark dax closed 1/4 of a percent higher. the eurostoxx 50 closed 1% lower. the dow jones industrials are at 12,539. it seems the success of apple products like the iphone and mac have proven too tempting for carter tatars. chinese authorities have closed two stores purporting to be official applet -- apple outlets. the apple brand in stores is apparently so convincing that some of the staff thought they were working for the company. >> in this southwestern city alone, chinese authorities found five branded apple's stores to be operating without authorization from the company. city officials ordered two of the stores closed because they did not have business licenses. chinese authorities said all of the shops were selling genuine apple products. even so, experts fear the apple brand could be damaged. >> it can hurt, especially if people cannot tell the difference between the real thing and the copy. when people have a bad experience, they might blame the brand. >

i've been led to believe moody's has said that, therefore i would like moody's to go on the record. what you think about too big to fail. shifting to another thing. i want to push a little bit. you said you would agree with mr. geller and everything. yet your comment to the first amendment that you may not agree. as i understand the reason that we had to change some of the laws to take away, or to limit the first amendment defense of the credit rating agencies, we put in knowingly and recklessly. knowingly or recklessly. which is now under the law, under the dodd-frank law the new standard as to credit rating agencies. it has nothing to do with the first amendment. the first amendment has been used up until now to prevent that from having any liability whatsoever. do you disagree with that, first of all understand? and do you think we should get rid of the new standard of extending liability to rating agencies under a knowingly and reckless, or reckless standard? >> not sure what your question is. >> question is, i want to make sure i understood it. i'm under the impression you said

part of political theater yes well it's interesting isn't it because moody's they've run out of foreign countries to destroy what they're corrupt ratings and now they're so they're targets on the united states so this is exactly what was predicted by marxism at the capitalist will sell themselves the news to hang themselves well the oligarchs i don't think you call these people capitalist but i'm also noting the word theater and you often see that in the terms of war the war theater. and i think this is part of what moody's is the rating agencies are part of the banking occupation globally they don't recognize any nation well they are going to downgrade they've already put them on notice people are saying as a part of the theater of the debt ceiling debate that's going on regardless of what's going on with the debt ceiling the american aaa rating for its bonds will be cut now i have suggested that countries like greece that are being attacked by moody's should set up their own rating agency and return the favor by downgrading american debt first and thus reap the benefit of this but for

ratings agencies like because that i'm poor's and moody's have become the subject of vicious attacks from politicians across europe agencies claim to give an independent assessment of the credit worthiness of countries but they've been blamed for helping cause the crisis by stirring up the alarm however some analysts suggest this means they're actually doing a good job the ratings agencies quite justifiably came in for a lot of criticism during the global financial crisis they are accused of being overoptimistic they were taking some fairly generous assumptions about its ability to repay there were sometimes overlooking some fairly fatal flaws in some derivative structures and it's fair to say i think most reasonable people would agree that perhaps the ratings agencies did contribute to the global financial crisis however i think there's been a notable improvement in standards over the course of the last two or three years and the fact that the ratings agencies now are actually getting so much criticism from european finance ministers probably suggest they're doing the job rather wel

deepening of moody's existing practices. we anticipate the regulatory landscape will lead to further change our objective remains what it has been for the past 100 years, provide the highest quality, research and analysis. thank you for inviting me to testify and i look forward to answering your questions. >> mr. gellert. >> on behalf of rep rating employees and shareholders i thank the chairman and ranking member capuano for asking me to join you. i am james gellert, chief executive of rapid ratings. as we arrive at the 1-year anniversary of dodd-frank we face the same or worse landscape as a year ago. s&p and moody's have influenced competitors that have even more challenges and costs and rating agencies are less likely to apply. rapid ratings is not a traditional rating agency. we are a subscriber paid firm. we utilize proprietary software based system to raise financial health of thousands of private and public companies and financial institutions from 17 countries. we reiterate all filers quarterly. will use only financ

moody's says it's reviewing america's top aaa dad rating for a downgrade signs of political bickering that's deadlocked budget negotiations in washington well for more on this we're now joined by author investor and health founder of the quantum fine jim rogers live from singapore mr rogers thank you very much for being here with us and the program well as we know this isn't the first time budget talks have sound lot but differences have always been overcome why is moving taking now to review the u.s. training here in the u.s. a stream of a good question the u.s. rating should have been downgraded years ago you know i don't know why they're just now getting around to it but we know that the rating agencies don't have much of the clue about anything they got everything wrong and so everything wrong. i don't know why they don't understand what's going on. what and what in delaying on debt payments be more disastrous for both sides and losing our few political points. i am sure that this is they're not going to close down the united states government this is political posturing and nothi

war on rating agencies of course that policymakers from europe across the world have denounced the moody's drastic downgrade of portuguese debt as an act of financial vandalism accusing the anglo-saxon rating agencies of driving states into bankruptcy and destabilizing the global system yeah that's right they call it financial vandalism she's are upping the rhetoric we have been talking about financial terrorism for months and months and months now they're upping their rhetoric they're going to get to the point now where they realize that this is in fact not vandalism which is a quaint way of saying terrorism they didn't accuse the sullivan law of vandalism on nine eleven who never did that it was an act of terrorism moody's s. and p. of pitch or financial terrorists and they are purposely targeting these countries for destruction because they want their assets for nothing well portugal's new premier of pedro process said moody's downgraded was a punch in the stomach at a time when the new government has done everything demanded by the e.u. and i.m.f. inspectors well that's part of a racke

from it no you're right of course when moody's downgraded portugal by for not just to junk. spreads on irish debt. irish begged to buy fridges to boost the economy so the yield on ten year bonds rose to record amid increasing speculation that the nation's credit rating may join greece and portugal and being downgraded to junk and the only thing that could rescue them they're saying is consumers but the consumer savings rate is over twelve percent look this is a complete disconnect between what is sound economic policy should be and the benefits or harm it may impose upon the population to people in ireland should not be out incurring more debt to buy consumer nondurables and white goods like refrigerators and washing machines they want to save money and they want higher interest rates and they want higher wages so why is the government or whoever at the club to credit class encouraging that they go deeper into debt oh let's see because it allows the policymakers to legitimize more quantitative easing which keeps interest rates artificially low that helps to oh the speculator

inspectors well that's part of a racket moody's a publicly traded company warren buffett on the biggest shareholder they manipulate that stock price they manipulate their ratings they telegraph what the rain's going to be before they make them so the insiders can profit from the inside information is out of commission is legal in washington they are lining their pockets servicing franchising to people live in these countries or look at austerity measures imposed upon them for things they never did and that's they never incurred and this is continuing unabated because nobody stepping in to represent the interest of the people the government like a drill in greece is in the pocket of the terrorist proper drill you are a terrorist you're a financial terrorist do your country a favor and toppers. so minor flaw spec director of the un office for world trade and development said the agency should be dissolved before they can do any more damage or at least banned from reading countries or they should create their own rating agencies nothing stops portugal from creating the portuguese bond rati

we saw what moody's did. are a lot of people watching with trepidation right now in the white house. >> three things that should be worrying our viewers this morning. moody's talking about a debt downgrade. bernanke warning about the economy and you've got the stuff on the right of your screen not happening in washington. all of that should be more of a fear than it seems to be on capital markets, tim. do we get the sense that people think they're going to work this out? >> i think that's part of it. i think it's also partly that some people don't necessarily understand. this is not to cast aversions on individuals. it's just when you're covering this every day, it's easy to see some of the consequences. it's making it tougher for people to follow this story sometimes if you're trying to keep your job or find a job. >> it has incremental moves which makes it hard to get your head around it. >> exactly. >> have a good show this morning. >> thank you. >>> newark mayor corey booker just across the river, he's a

portugal's economy has been thrust back as moody's downgraded its sovereign debt to junk status. moody's said there was certain the country simply wouldn't meet the debt target and would need a second bailout. two other national rating agencies still do give portugal more favorable triple-b rating, hardly a resounding improvement. let's go to our correspondent. >> the government immediately reacted and said moody's was not taking into account the broad political consensus in favor of implementing the bailout that was agreed on in may and now we have a new government presenting its program, and as the government mentioned it, statement in response to moody's decision, for example, an extra levy on income on all portuguese not just other workers who have already seen their pay cut earlier this year. moody's does say it recognizes the political situation has improved and it worries what about it calls implementation risks. where cuts are supposed to be made according to the bailouts already aagreed and it's worried the government may not be able to get those done. >> and that's on t

inspectors well that's part of a racket moody's a publicly traded company warren buffet's when the biggest shareholder they manipulate that stock.

its bonds will be cut now i have suggested that countries like greece that are being attacked by moody's should set up their own rating agency and return the favor by downgrading american debt first and thus reap the benefit of this but for some reason george pappa joyous is financially illiterate and has no idea how to fight a financial.

president obama says enough is enough in debt negotiations while moody's puts the u.s. on notice. >>> excessive force. three tennessee officers come under fire after a brutal beating is captured on dash cam video. >>> and a spectacle. the u.s. mount roars to life with a dazzling nighttime show. captions paid for by nbc-universal television >>> hello and good morning. welcome to our viewers across the nation including the pacific time zone. i'm lynn berry. this morning we begin with boiling point. budget negotiations at the white house grew heated yesterday as lawmakers failed again to compromise on spending cuts and tax hikes as part of the plan to raise the debt ceiling. all of this as moody's investor service puts the country's stellar credit rating under review. kristin dahlgren joins us with more this morning. kristen, good morning. >> reporter: good morning, lynn. just when you thought it couldn't get any uglier, word of the tepsest talks yet. republican house majority leader eric cantor is saying the president said to him, eric, don't call my bluff, and then storm

moody's previously had as one notch higher than s&p, so now, with the movies in adjustment -- the moody's adjustment, what that means is we are still very much on a roll with the debt. a strong aa. we noticed in the electronic markets, as we're required to do with our material disclosure, and all of our bond documents, for our build america bond revenues. president vietor: commissioner moran. vice president moran: did they state a reason for the downgrade? >> this is on a current basis as well as a projected basis. what movies does is just take them all and line them up in a row, and based on our current level of water sailors and the cumulative fund balance reserves, that made us go into the third notch of aa. vice president moran: and was the size of the balancing accounts an issue there? >> they factor in all of the cash we have available. and also noticed a long term strength of the economics. we cannot fall out of sync. the willingness of the commission to adopt the rate increases that were needed and the cost management, the efficiencies. they did give us a lot of credit strength, w

let's give all the details of stacy herbert well max that's what you would think if you listen to moody now my first headline is actually a tweet from eric schatz or from bloomberg ron paul tells me to pull a reading probably not worth saving moody's part of political theater yes well it's interesting isn't it because moody's they've run out of foreign countries to destroy what they're corrupt ratings and now they're so they're targets on the united states so this is exactly what was predicted by marxism and the capitalists will sell themselves the news to hang themselves well that all of dark side if you don't think you could call these people capitalist but i'm also noting the word theater and you often see that in the terms of war the war theater . and i think this is part of what moody's is the rating agencies are part of the banking occupation globally they don't recognize any nation well they are going to downgrade they have already put them on notice people are saying is a card of the theater of the debt ceiling debate that's going on regardless of what's going on with the debt c

credit rating agency moody's downgraded irish government a notch from baa3 to ba1. the debt strapped country received a bailout package from eurozone nation. after that expires moody's said ireland will likely require additional financial aid to stay afloat. the agency added if further support becomes necessary, private investors may be asked to share the burden. >>> now let's take a look at tokyo stocks. in new york overnight the dow was lower for a third straight day as eurozone debt problems continue to worry investors. to see how markets are trading in japan this wednesday morning we cross over to ramin mellegard at the tokyo stock exchange. ramin, how are the markets looking to far? >> good morning to you, ai. the nikkei and the topix trading in the negative in the first few minutes of trading and that follows on from the losses we saw on the dow and markets continue to be dominated by news surrounding eurozone debt concerns after moody's downgrade of ireland's credit rating which yet again highlights global concerns over the eurozone economy as a whole. we did

thank you for joining us today mr young so moody's the rating agency behind the move has been involved in a number of scandals from claims of blackmail to labeling junk assets out. aaa back in two thousand and eight when liable for their writings well look this is the really interesting situation isn't it really i mean what we've seen is the european union to three years ago said the problem with credit ratings were that their their ratings couldn't be trusted then all of a sudden when they actually come up with plausible ratings against the european union suddenly the finance ministers such as mr showed lar saying that oh these are discreet small companies because actually they're trying to get at the truth the situation is absolutely true i mean a company like moody's which had i think a largely french organized department doing european sovereign debt until quite recently got many things absolutely wrong in the boom in the bubble but actually one of the biggest things that they got wrong was the fact that they weren't being pragmatic enough when it came to the debt and the debt prob

moody's comments about it. one of the reasons we saw gains is particularly because we had encouraging growth numbers coming out of china and more importantly, we had soothing words from the federal reserve chairman ben bernanke himself. at the close of trade, a gain between 0.3 and 0.5%. let's go back to what bernanke was saying, in his semiannual testimony, he said once again, the soft spot that the economy has hit will be short lived. here's what's interesting about what he had to say. after spending months denying to people there would be stimulus measures, he gave this hint. >> the federal reserve remains prepared to respond should economic developments indicate that an adjustment would be appropriate. >> now, that's quite a different tone from the message we got two weeks ago when the fed ended its last round of stimulus of qe2. looking ahead to the start of trade in the u.s., right now in premarket trade, the major markets are pointing to a higher open. this is quite different from just a little while ago

moody's fitch instead and poor's the three large rating agencies all of which are u.s. based in fact based here here in new york city have come under increasing scrutiny over the last several years and they came in for the probably the most overt and harsh criticism i've ever seen and i think almost anyone's ever seen out of the e.c.b. or the european central bank when they downgraded portugal several notches despite the assurances from the i.m.f. and the e.c.b. that help was coming and there was the specter raised that they were biased against non u.s. and tidies moody's has made various issuances before about problems in the united states they fired some shots across the bow and i think they were under both political pressure as well as economic pressure on the august fundamentals here to show that they will also hold the united states to the same standard that they're getting much maligned for holding portugal and ireland and greece to the media these days that is sitting in a way to justify their existence where they could actually threaten the struggling economy is

that's moody's. our debt has become so unmanageable that we face a credit downgrade with cons subsequent higher interest rates if we do not enact a big-time deficit reduction package. now, this year is our third straight trillion-dollar deficit. our national debt is 14.3 -- actually $14.5 trillion. and the president's budget would add $13 trillion in additional debt if he gets his way. i don't know about you, but i can't tolerate that. added to already almost a $15 trillion debt today. i've spoken previously about the debt bubble the nation finds itself in but i want to re-emphasize that point in light of the warnings from ratings agencies that our credit faces a downgrade absent real deficit reduction. currently federal debt held by the public equals a modern record of about 69% of g.d.p. and it's headed to 100% and we all know it. the congressional budget office reports that current tax and spending law takes that figure to 76% of g.d.p. over the next 10 years and we all know it's going to hit 100%

moody's has just announced that it wanted to downgrade spain is spain's rating spain's bonds have already fallen by several percent and the euro has fallen as well now this of course is happening to the fourth largest economy in the eurozone and you would think it should be better off but spain has been plagued by some very serious economic problems there's of course the the very large outstanding debts as well as the unemployment we're already used to hearing about this big c. country's. economic woes and that of course is portugal ireland greece and spain and now italy is also looking at some major issues as far as their economy is concerned by now also the the heavy drivers of the european economy the for france and germany are also finding themselves in sort of hot water because just recently in the i.m.f. has said that france has somewhat been too optimistic about the valuation of its prognosis and actually may not be as well off as the french authorities have hoped . have hoped the country to be the problem is these are things that have just happened suddenly i mean the french budge

credit rating agency moody's as ward washington that it might downgrade the country's triple a rating if its multi-trillion debt ceiling is not raised this comes as china america's largest foreign creditor urges the obama administration to adopt response or policies to protect investor interests want to discuss this i'm now joined live by scott carty the c.e.o. of a bold investment company joining us live there in los angeles thanks very much indeed for being with us now this is surely all political posturing as now the u.s. cannot afford not to raise its debt ceiling because if it didn't what would be the implications. well bill you're absolutely right and thanks for having me on the program clearly the debt ceiling will be raised i think you're right it is political posturing and everyone on each side of the trying to extract the best deal that they can but if we were to play the worst case scenario and we were to not raise the debt ceiling and then default or some sort of nonpayment of bills it shakes or rattles the confidence in the world that the the u.s. market and the governmen

great rating agency moody's threatening to take spain's worrying status down and. reports from madrid on how it increases a massive bailout that's way heavy. in fact moody's has just announced that it wanted to downgrade spain's rating this of course is happening to the fourth largest economy in the eurozone and you would think it should be better off but spain has been plagued by some very serious economic problems there's of course the the very large outstanding debts as well as the arguer ganter and unemployment problems in fact spain has one of the highest unemployment rate ings in europe we're already used to hearing about the so-called big c. countries being in economic woes and that of course is for to go ireland greece spain and now italy is also looking at some major issues as far as their economy is concerned right now also the heavy drivers of the european economy the france and germany are also finding themselves in sort of hot water because just recently in the i.m.f. has said that france has been too optimistic about the valuation of its prognosis and

fitch, moody's, s&p, have become bad words. they are coming under increasing scrutiny in europe. the european commission president has condemned a decision by moody's to downgrade portugal's credit rating. the german finance minister has said that he would like to "break the power of rating agencies and limit their influence." recent ratings have put a lien european countries like portugal under pressure. portuguese treasuries went on sale and they reached their highest yields ever. >> the government is outraged by the downgrading. the portuguese bonds have jumped started even though the government recently introduced drastic austerity measures. moody's is concerned that portugal will need a second bailout despite spending cuts and this has angered the finance minister. >> the reasoning behind this assessment is very hard to understand and even more so that it has come at this particular time. >> portugal's government says they are just getting to grips with the crisis. some economists support that view. >> things are progressing relatively well with the national budget. the defi

>> you know, basically, s & p and moody's are saying yes. yes.these short-term tricks that would get you over the finish line in the long term are going to help with your credit rating. if you don't pay your bill on time, bottom line like anybody at home, it will damage your credit in the future and there's really no way around it. you guys need to get serious and make a deal. that was the message. >> let me turn topics here a little bit. we got into this mess in part because of subprime loans to people who could not afford them. the "wall street journal" is reporting that a number of private investment firms again are writing loans for subprime borrowers. how does that make any sense? >> let me try and defend this one. we all know someone who technically, they have gone out to buy a house and technically they can afford it. they look at the payments and they are ready and willing to make the payments. but the bank won't qualify them for one reason or another. the companies that are making these loans are saying that in a lot of cases, it's just

moody's see significant risk in greece. >> let us look at the market numbers. in frankfurt, the benchmark dax closed 1/4 of a percent higher. the eurostoxx 50 closed 1% lower. the dow jones industrials are at 12,539. it seems the success of apple products like the iphone and mac have proven too tempting for carter tatars. chinese authorities have closed two stores purporting to be official applet -- apple outlets. the apple brand in stores is apparently so convincing that some of the staff thought they were working for the company. >> in this southwestern city alone, chinese authorities found five branded apple's stores to be operating without authorization from the company. city officials ordered two of the stores closed because they did not have business licenses. chinese authorities said all of the shops were selling genuine apple products. even so, experts fear the apple brand could be damaged. >> it can hurt, especially if people cannot tell the difference between the real thing and the copy. when people have a bad experience, they might blame the brand. >

congress has prompted moody's to issue a second downgrade warning of america's aaa rating. federal reserve chairman ben bernanke is adding to the pressure on lawmakers to raise the u.s. debt limit. >> clearly, if we went so far as to default on the debt it would be a major crisis. the treasury security is viewed as the most liquid in the world, the foundation for much of our financial system. the notion that it would become suddenly unreliable and illiquid would throw shockwaves through the entire global financial system. >> washington must raise the debt limit to service its debt. president barack obama opposes large cuts to social security and medicare. >> banking officials say ireland is making good progress and is on track to meet its austerity targets. that is the word from bailout lenders including the european union. they delivered their assessment just one day after moody's downgraded irish that -- debt. officials from the eu, imf, and ec be have been in ireland checking if the government is worthy of receiving the next installment of its $85 -- its 85 billion euro

part of political theater yes well it's interesting isn't it because moody's they've run out of foreign countries to destroy what they're corrupt ratings and now they're so they're targets on the united states so this is exactly what was predicted by marxism at the capitalist will sell themselves the news to hang themselves well the oligarchs i don't think you could call these people capitalist but i'm also noting the word theater and you often see that in the terms of war the war theater. and i think this is part of what moody's is the rating agencies are part of the banking occupation globally they don't recognize any nation while they are are going to downgrade they've already put them on notice people.

its bonds will be cut now i have suggested that countries like greece that are being attacked by moody's should set up their own rating agency and return the favor.

moody's is putting the triple-a credit rating on review. rating agency said it is worried congress will not raise the nation's debt ceiling before the country defaults on some interest payments. >> with no debt deal in sight, the only solution may be for both sides to bite the bullet and come up with a solution that no one likes. but are they prepared to do it? joining me now live from capitol hill is republican congressman jim jordan. chairman of the republican study committee. he also wrote an op-ed in yesterday's "usa today" calling for a balanced budget amendment to the constitution. representative jordan, good to see you. thank you for being here. >> good to be with you this morning. >> handicap this for me. you have been hearing the same news we have been hearing about a hostile end to the fourth day of talks yesterday. we have a fifth day of talks scheduled today starting this afternoon. is it as bad as it sounded? >> probably. i mean, no one knows where this is going to wind up. what i do know is if we don't do some bold dramatic th

moody's investor service placed the government's bond rating on review for possible downgrade. without a debt deal on capitol hill, moody's points to a "small but rising risk of a short-lived default" tom, that warning comes as the federal reserve says its ready to add more fuel to the economy if the recovery runs out of gas. >> tom: susie, fed chairman ben bernanke made that pledge during his semiannual congressional testimony today. that helped investor confidence, at least initially. stocks rallied sharply during the chairman's testimony but backed off those highs as the day wore on. by the close, the dow was up just 44 points, the nasdaq was up 15 and the s&p 500 gained four. >> susie: when it comes to the recovery and the debt ceiling debate, ben bernanke is keeping all his options open. darren gersh reports. >> reporter: in fed speak, chairman ben bernanke took a more "symmetric" view today. that means the central bank's next move could be to tighten up, nudging interest rates higher. or it could be to loosen up, nudging rates lower. and that could mean renewing large-sca

moody's today cut its rating on portugal to junk, with a negative outlook. moody's fears portugal, like greece, will have trouble cutting costs and will need a second bailout. >> susie: meanwhile, an important meeting tomorrow to hammer out a bailout loan plan for greece. things were looking good for a deal until standard & poor's ratings agency warned the proposal to roll over greek government debt was in effect a "selective default." joining us now to explain what that means for investors, kenneth rogoff, professor of economics at harvard university. >> nice to have you with us tonight. >> thank you. >> susie: so the deal that was worked out between international bankers. europe officials and the government to roll over. >> a new long term package and a soft restructuring, reprofiling. a voluntary rollover. but s&p says no matter how you look at it, this is a selective default. is this semantics or a default? >> it's a default. when you don't pay your debt on time and have to go to the lender and stretch it out and get new terms, this is a default. the bar