The financial crisis had many casualties — one being the S&P AAA rating in Corporate America. Behemoths like Berkshire Hathaway, GE and Pfizer all lost their AAA status during the depths of the crisis.
But interestingly, it didn’t matter much anyway, because the markets had already weighed in before the S&P downgraded the companies. Investors hardly flinched.
It’s a sea change from the early 1980s, when the top rating was coveted. Back then, 60 U.S. corporations held the title. By 1995, half as many were rated AAA.
Today, it’s only four: Microsoft, Exxon Mobil, Johnson & Johnson and Automatic Data Processing. (This is excluding some financial and government-affiliated organisations.)
Last night on CNN, S&P’s John Chambers said it was not planning on downgrading those companies’ AAA ratings despite the agency’s policy not to have a company’s rating be higher than its home country’s sovereign rating.
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