What Does S&P's Downgrade Of Japan's Debt Mean?

In an effort to halt expansion of Japan's massive public debt, Japan's Prime Minister Seeks Doubling National Sales Tax. Prime Minister Yoshihiko Noda said containing Japan’s public debt load, the world’s largest, is critical after Standard & Poor’s downgraded credit ratings on France, Austria and seven other European nations.

Mark Thoma submits: I don't agree with every word of this argument by Dean Baker, particularly some of the parts about the bias in the CPI, but I do agree with the main thrust:

When I looked over the invitees to the Treasury Department's forum on housing policy today, I noticed one of the names that wasn't there: The Center for Economic and Policy Research's director, Dean Baker.

By David Pinsen: S&P Downgrades US Debt to AA+ S&P's downgrade of US Debt to AA+ on Friday night wasn't wholly unexpected. S&P had put the US on watch for a ratings downgrade last month (as did Moody's (MCO)). It also wasn't the first nationally recognized statistical rating organization (NRSRO) to do so: Egan-Jones downgraded US debt in July.

Moody's took away the UK's triple A rating late Friday. A ratings downgrade has long been rumored, and although the timing is always surprising, the move itself has long been anticipated. Sterling slumped on the news in thin dealings, losing a cent in about 30 minutes.