Pepsi and IBM are Now More Creditworthy than the U.S. Government

Agora Financial’s Rude Awakening notes that the U.S. Government is now considered less credit-worthy than Pepsi or IBM by the credit default swap market:

As the nearby chart indicates, the price of insuring Treasury debt against default now costs more than the price of insuring the debt of almost any AA or A+ rated company in the country. In other words, the Treasury is not quite as AAA as it should be, according to the buyers of credit default swaps.

[Click here for full image.]

But fear not, CDS on Treasury debt remains well below the price of comparable CDS on Bulgarian, Argentinean and Latvian debt.***