Why S&P downgraded the US and Moody's didn't
Felix Salmon has a long post analysing the fundamental difference between S&P’s ratings and Moody’s ratings - the former only looks at probability of default whereas the latter is focused on expected losses, and therefore also includes recovery rates in its analysis.
Philosophically, Moody’s also pays attention to the signalling value of its rating, whereas S&P seems to be largely ignoring this. Seen from this perspective, the different results for the US make sense, and the article as a whole serves as a good reminder of the value of ratings in general.
