David T. Beers
Encyclopedia
David T. Beers is a financial analyst and the current head of sovereign credit ratings for credit rating agency
Standard & Poor's
(S&P). In August 2011, Beers earned significant attention as the S&P executive responsible for downgrading the credit rating
of United States Treasury bonds to AA+
. Prior to this, the United States had maintained a AAA credit rating since 1941. He lives in London
.
and an M.Sc. degree in economics from the London School of Economics
(LSE). He has since set up a scholarship at LSE in his name. Beers joined S&P in 1990 focused on rating sovereign debt of over 100 countries. Prior to that, Beers had been an economist at Salomon Brothers
focused on analyzing the creditworthiness of sovereign debt. He also worked at Bankers Trust Company, evaluating the risks of lending to Asia-Pacific countries.
which began in 2007.
Although relatively unknown to the general public, Beers is one of the most influential people in the world: the Guardian
newspaper wrote in August 2011 that, "In recent weeks, we have witnessed elected leaders in the world's most powerful nation dancing to the tune of David Beers. He's the mustachioed, chain-smoking head of sovereign credit ratings for S&P, the largest and arguably most influential member of the big three." Reuters
, meanwhile, said: "You may have never heard of David Beers but every finance minister in the world knows of him". The Independent
has said of Beers that he "might be the most powerful man in the world that you've never heard of."
Credit rating agency
A Credit rating agency is a company that assigns credit ratings for issuers of certain types of debt obligations as well as the debt instruments themselves...
Standard & Poor's
Standard & Poor's
Standard & Poor's is a United States-based financial services company. It is a division of The McGraw-Hill Companies that publishes financial research and analysis on stocks and bonds. It is well known for its stock-market indices, the US-based S&P 500, the Australian S&P/ASX 200, the Canadian...
(S&P). In August 2011, Beers earned significant attention as the S&P executive responsible for downgrading the credit rating
Credit rating
A credit rating evaluates the credit worthiness of an issuer of specific types of debt, specifically, debt issued by a business enterprise such as a corporation or a government. It is an evaluation made by a credit rating agency of the debt issuers likelihood of default. Credit ratings are...
of United States Treasury bonds to AA+
Bond credit rating
In investment, the bond credit rating assesses the credit worthiness of a corporation's or government debt issues. It is analogous to credit ratings for individuals.-Table:...
. Prior to this, the United States had maintained a AAA credit rating since 1941. He lives in London
London
London is the capital city of :England and the :United Kingdom, the largest metropolitan area in the United Kingdom, and the largest urban zone in the European Union by most measures. Located on the River Thames, London has been a major settlement for two millennia, its history going back to its...
.
Education and career
Beers received a B.A. degree in international relations from the University of VirginiaUniversity of Virginia
The University of Virginia is a public research university located in Charlottesville, Virginia, United States, founded by Thomas Jefferson...
and an M.Sc. degree in economics from the London School of Economics
London School of Economics
The London School of Economics and Political Science is a public research university specialised in the social sciences located in London, United Kingdom, and a constituent college of the federal University of London...
(LSE). He has since set up a scholarship at LSE in his name. Beers joined S&P in 1990 focused on rating sovereign debt of over 100 countries. Prior to that, Beers had been an economist at Salomon Brothers
Salomon Brothers
Salomon Brothers was a bulge bracket, Wall Street investment bank. Founded in 1910 by three brothers along with a clerk named Ben Levy, it remained a partnership until the early 1980s, when it was acquired by the commodity trading firm Phibro Corporation and then became Salomon Inc. Eventually...
focused on analyzing the creditworthiness of sovereign debt. He also worked at Bankers Trust Company, evaluating the risks of lending to Asia-Pacific countries.
Media perception
Starting in the early 1970s, the "Big Three" ratings agencies (S&P, Moody's, and Fitch) began to receive payment for their work by the securities issuers for whom they issue those ratings, which has led to charges that these ratings agencies can no longer always be impartial when issuing ratings for those securities issuers. Securities issuers have been accused of "shopping" for the best ratings from these three ratings agencies, in order to attract investors, until at least one of the agencies delivers favorable ratings. This arrangement has been cited as one of the primary causes of the subprime mortgage crisisSubprime mortgage crisis
The U.S. subprime mortgage crisis was one of the first indicators of the late-2000s financial crisis, characterized by a rise in subprime mortgage delinquencies and foreclosures, and the resulting decline of securities backed by said mortgages....
which began in 2007.
Although relatively unknown to the general public, Beers is one of the most influential people in the world: the Guardian
The Guardian
The Guardian, formerly known as The Manchester Guardian , is a British national daily newspaper in the Berliner format...
newspaper wrote in August 2011 that, "In recent weeks, we have witnessed elected leaders in the world's most powerful nation dancing to the tune of David Beers. He's the mustachioed, chain-smoking head of sovereign credit ratings for S&P, the largest and arguably most influential member of the big three." Reuters
Reuters
Reuters is a news agency headquartered in New York City. Until 2008 the Reuters news agency formed part of a British independent company, Reuters Group plc, which was also a provider of financial market data...
, meanwhile, said: "You may have never heard of David Beers but every finance minister in the world knows of him". The Independent
The Independent
The Independent is a British national morning newspaper published in London by Independent Print Limited, owned by Alexander Lebedev since 2010. It is nicknamed the Indy, while the Sunday edition, The Independent on Sunday, is the Sindy. Launched in 1986, it is one of the youngest UK national daily...
has said of Beers that he "might be the most powerful man in the world that you've never heard of."