RJ and Makay

Though in the offing for some time, it's still a shock to see a credit agency move toward downgrading U.S. debt. Today, Standard & Poor's (S&P) Ratings Services reduced its outlook on the U.S. to "negative," potentially setting the stage for a downgrade from triple-A status in the near future.

"More than two years after the beginning of the recent crisis, U.S. policymakers have still not agreed on how to reverse recent fiscal deterioration or address longer-term fiscal pressures," explains S&P credit analyst Nikola G. Swann. The chance of a U.S. downgrade within two years is at least one in three, Swann estimates.

The federal government's Financial Crisis Inquiry Commission (FCIC) drew nine main conclusions in its recent "Financial Crisis Inquiry Report." Perhaps the most compelling one: the financial crisis was avoidable.

The FCIC pulls no punches on this point. "The captains of finance and the public stewards of our financial system ignored warnings and failed to question, understand, and manage evolving risks within a system essential to the well-being of the American public," its report says. "[A] crisis of this magnitude need not have occurred."