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S&P president: Obama knows the problem is serious

By Katie Benner August 9, 2011: 9:48 AM ET
Following the historic U.S. credit downgrade, Standard & Poor’s president Deven Sharma talks about the market sell off, the president’s response and why the Treasury might be taking this all so hard.

Deven Sharma– For those who doubt that credit ratings still wield power, look no further than Monday’s market rout.

The selloff followed a controversial decision by Standard & Poor’s to downgrade the United States from AAA, the gold standard in credit ratings, to AA+. Even though S&P’s head of sovereign ratings John Chambers has downplayed the move (“It’s like going from indigo to navy blue”), already fragile stock markets plummeted, and the world’s finance ministers were forced to discuss the situation.

With stocks still shaky, gold prices soaring and talking heads debating whether this is market panic or 2008 redux, FORTUNE spoke with Deven Sharma, the president of S&P, the company that at the eye of this particular storm. Sharma, who became head of the McGraw-Hill (NYSE: MHP) division in September 2007, talked about the stock market slide, his company’s reputation, the controversial $2 trillion revision and why he liked Obama’s public response to the downgrade.

Given that the U.S. downgrade was widely anticipated, what do you make of the sharp stock market selloff?

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