As we mentioned earlier this week, most companies aren't planning to change their short-term investment strategy following S&P's downgrade of the U.S. debt. But a new survey released today by the Association for Financial Professionals (AFP) found that one in four financial professionals now say the downgrade could impact hiring.
The survey, which was conducted this week, also found that 40% expect the cost of capital will be impacted detrimentally by S&P's action.
"What we are hearing this week is far different from what finance pros were telling us in June," said Jim Kaitz, AFP's president and CEO. "While the U.S. may still be the best place to park idle cash, some companies think the U.S. isn't the best place to deploy strategic cash. That means they may look elsewhere when expanding their business or hiring staff. "
·A quarter of financial professionals say that S&P's action makes the U.S. a less desirable place for capital investments and hiring.
·40 percent of survey respondents anticipate access and cost to capital will be detrimentally impacted by S&P's decision
·Despite S&P's decision and despite the extreme market volatility, companies still see Treasury securities as an important investment vehicle in a portfolio that is designed primarily to protect principal