Precipitous, Wrong and Dangerous: What To Do When “Those Who Know Best,” Don’tBill Miller, Chairman, Chief Investment Officer and Portfolio Manager for Legg Mason shares his point of view on the recent S&P change in the U.S. credit rating: “The downgrading by Standard & Poor’s of the credit rating of the United States from AAA to AA+ on August 5th was precipitous, wrong, and dangerous. At best, S&P showed a stunning ignorance and complete disregard for the potential consequences of its actions on a fragile global financial system.”

We know what Standard & Poor’s has done. What are you going to do?

Here is Bill Miller’s full commentary.

For what it’s worth, I agree with Bill. And note, the ratings of Moody’s and Fitch remained unchanged, while Northern Trust and other financial institutions have announced “no change” in their investment policies.

As far as S&P’s rating is concerned, the deed is done. The questions now are:

  • What does this mean for each of us in our businesses?
  • Will this be a blip and we will all move on?
  • Is this the beginning of a serious focus on the U.S. deficit (now equal to GDP) and what will be the challenges and opportunities that show up for each of our businesses?

I really liked what I heard yesterday from my *Vistage CEO members — to a person, I heard:  “I plan to be mindful of what is happening in the world and at the same time be mindful of 1) opportunities to grow my business and seize opportunities, and 2) my cash reserves.” This commitment to growth and innovation by business owners has gotten this country to new levels of prosperity throughout its history, and I remain optimistic that we will see the same result this time around.

*Note: I am the chair of a CEO peer group as part of Vistage International. For more information, please visit

Elisa K. Spain

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