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City wants Moody’s to retract bond report

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Posted: Monday, July 29, 2013 10:00 pm | Updated: 7:34 am, Tue Jul 30, 2013.

After Moody’s Investor Services downgraded its bond rating for city of Santa Fe by a notch over the weekend, the city finance director on Monday continued to demand that the rating agency retract what he says is an erroneous report that lumped Santa Fe with recent trouble in Detroit and Chicago

A spokesman for Moody’s, however, reiterated Monday that its analysts feel they were justified in placing the city “on review” this spring and in the weekend downgrading of Santa Fe’s general obligation bond rating from its third-best rating of “Aa2” to its fourth-best rating of “Aa3.”

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3 comments:

  • posted at 10:59 am on Tue, Jul 30, 2013.

    Posts:

    maybe the City doesn't realize that moody's knows more about the games the city plays with the books, like using park bond money for unauthorized spending and the fact that alot of embezzlement and fraud/waste go unchecked like the parking and ITT fiascos. those are just the tip of the iceberg!

     
  • mauryb brooks posted at 9:56 am on Tue, Jul 30, 2013.

    mauryb Posts: 9

    It is a little publicized fact that companies such as Moody's do not always use clear objective measurements. This is claimed to be the real cause of the financial melt down a few years ago where junk quality investments were intentionally given high ratings even though it could not be justified. So while the rating do hurt the city's fund raising abilities and related costs they really may not mean anything.

    The seller of the financial papers pays to be rated where as in the past the cost was past onto the buyer. With the shift of credibility comes the shift of credibility. Maybe if the City gives Moody's a few extra bucks they will change the rating, it worked for Morgan Stanley.

     
  • Julian R. Grace posted at 6:54 am on Tue, Jul 30, 2013.

    Logies New Mexican Posts: 107

    The City of SF and State PERA Board have a warped view of reality. Recent legislative changes to how PERA treats its members to get solvent only perpetuate the mentality that it's okay keep too much of the fund in equities where the volatility wiped out a fourth of its value during the recessing of 2008-2009. Anyone who saw that coming changed their investment formula to increase bond holdings where at least the corpus of the fund would be protected. With the PERA authorized to play with the PERA member's money by speculative stock transactions via a third contracted party that gets paid regardless of profit or loss is the tragedy. Read the PERA financials where they call losses "Negative Gains" and you can see that it's the same old way of mismanagement of the PERA fund. Members need to organize and when electing board members get responsible people in there to do the right thing, not the easy way out, like change the laws to rip-off existing retirees, active members and future employee members. Wake UP State employees!

     
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