Deven Sharma, President of S&P(Standard & Poor's) , is not an alien name now. A boy from Jharkhand who rightly (may be some people disagree with me) downgraded the US long term debt rating from AAA to AA+ which is considered the Gold standard in the world of finance. If this was not US then this rating downgrade would have been long back. I don't want to go in the history of subprime crisis and recession which world has faced after that but surely I want to point out the fact that since US is the most strongest and largest economy of the world due to which its rating was still maintained to AAA till yet (before Aug 2011) by all the 3 major rating giant (Moody,Fish and S&P. Moody and Fish still maintaining US rating to AAA).
After the S&Ps announcement of downgrading US long term debt rating, there were lot many allegations on the way it rates the country or the firm. On 5th of August just before this announcement there were lot many conversation happened between US officials and Sharma number-crunchers teams.After this move Sharma comes into limelight hailed by few but criticized by several in financial world.
Sharma joined S&P as the executive VP in 2006 after working with 4 years with its parent company MgGraw-Hill cos. In 2007, when subprime housing crisis where getting out of hand , Sharma was promoted as the President of S&P. Around this time only the credit rating were picked as the one of the culprits of the subprime crisis and the melt down for the flawed rating model of housing loans. Being the President of one of the foremost rating agency , Deven had a nice grilling from US officials but he negotiated most on those. Even in one of his interview he admitted that the comments made by US law makers have changed drastically from strong criticism to appreciation.
Things have changed for Sharma after his unprecedented decision to downgrade US to one notch down . On 23rd Of this month ,S&P said that Sharma is stepping down as the President of S&P and his position is taken up by COO of Citibank, Douglas Peterson. The reason given for the decision by the parent company is that since the Jana Partners , an hedge fund, suggested to broken up the rating firm and publishing company as 2 different entities in the market. Taken this restructuring into account the directors decided to replace Sharma. But internally the reason to replace Sharma is because of the pressure the company is getting from US officials and Justice Dept. Since the US justice Department is already investigating the rating agency in action of assigning the higher rating to housing mortgage which led to 2008-09 financial crisis, this move may get some relaxation to the company.
12th September 2011 may be the last day for Deven as the President of S&P but no one can forget the historical decision he has taken in the view for the benefit of the investors. So it is right to say the boy who downgraded US is downgraded by US(US pressure).
After the S&Ps announcement of downgrading US long term debt rating, there were lot many allegations on the way it rates the country or the firm. On 5th of August just before this announcement there were lot many conversation happened between US officials and Sharma number-crunchers teams.After this move Sharma comes into limelight hailed by few but criticized by several in financial world.
Sharma joined S&P as the executive VP in 2006 after working with 4 years with its parent company MgGraw-Hill cos. In 2007, when subprime housing crisis where getting out of hand , Sharma was promoted as the President of S&P. Around this time only the credit rating were picked as the one of the culprits of the subprime crisis and the melt down for the flawed rating model of housing loans. Being the President of one of the foremost rating agency , Deven had a nice grilling from US officials but he negotiated most on those. Even in one of his interview he admitted that the comments made by US law makers have changed drastically from strong criticism to appreciation.
Things have changed for Sharma after his unprecedented decision to downgrade US to one notch down . On 23rd Of this month ,S&P said that Sharma is stepping down as the President of S&P and his position is taken up by COO of Citibank, Douglas Peterson. The reason given for the decision by the parent company is that since the Jana Partners , an hedge fund, suggested to broken up the rating firm and publishing company as 2 different entities in the market. Taken this restructuring into account the directors decided to replace Sharma. But internally the reason to replace Sharma is because of the pressure the company is getting from US officials and Justice Dept. Since the US justice Department is already investigating the rating agency in action of assigning the higher rating to housing mortgage which led to 2008-09 financial crisis, this move may get some relaxation to the company.
12th September 2011 may be the last day for Deven as the President of S&P but no one can forget the historical decision he has taken in the view for the benefit of the investors. So it is right to say the boy who downgraded US is downgraded by US(US pressure).
