Standard & Poor's has downgraded Japan's sovereign-credit rating from AA- to A+. It is the most recent of the major credit-rating companies to do so; Moody's was the first, in December 2014, followed by Fitch in April. S&P justified its downgrade by saying that the outlook for Prime Minister Shinzo Abe's "Abenomics" program is grim:
"Despite showing initial promise, we believe that the government's economic revival strategy—dubbed 'Abenomics'—will not be able to reverse this deterioration in the next two to three years."
The proper response to a sovereign downgrade by a major credit rater is: "Who cares?" Sovereign-credit ratings are barometers of conventional wisdom, rather than the result of some secret-sauce macro forecasting method. As such, credit ratings tend to be lagging indicators of economic conditions, not leading indicators. In other words, credit ratings are a great way of finding out what happened to an economy months ago, if you happened not to be reading the news at the time.