US credit rating sinks as national debt increases
See also: What it really meant when US Treasury securities were just downgraded
Faster than President Joe Biden (D) stumbling up the stairs of Air Force One, U.S. Treasury secretary Janet L. Yellen issued a statement denouncing Fitch Ratings for downgrading the U.S. government’s credit from an outstanding AAA to a still respectable AA+.
I strongly disagree with Fitch Ratings’ decision. The change by Fitch Ratings announced today is arbitrary and based on outdated data. Fitch’s quantitative ratings model declined markedly between 2018 and 2020 — and yet Fitch is announcing its change now, despite the progress that we see in many of the indicators that Fitch relies on for its decision. Many of these measures, including those related to governance, have shown improvement over the course of this Administration, with the passage of bipartisan legislation to address the debt limit, invest in infrastructure, and make other investments in America’s competitiveness.
Fitch’s decision does not change what Americans, investors, and people all around the world already know: that Treasury securities remain the world’s preeminent safe and liquid asset, and that the American economy is fundamentally strong.
Etc. and etc.
Well, if you say so, Secretary Yellen, but others slightly disagreed. Yellen is correct when she states “that Treasury securities remain the world’s preeminent safe and liquid asset, and that the American economy is fundamentally strong” — but, under Biden’s “tax and spend and then tax and spend some more” policies, not as safe and as strong as previously. The U.S. debt is $31.5 trillion…and growing, which is why the U.S. recently raised its debt ceiling. However, there is not a parallel ceiling on government spending, which is soaring, so our national debt will continue to increase. As will inflation.
Other than that, have a nice day.
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