The UNTHINKABLE has happened. U.S. government debt has lost its sterling AAA credit rating! Like Greece, Iceland, and Dubai, the runaway spending from our Washington, D.C., politicians has caught up with us.
The good news is that the downgrade has come from upstart rating agency China-based Dagong International Credit Rating. The bad news is that Standard & Poor’s, Moody’s, and Fitch are almost certain to follow, and that will mean disaster for the dollar as well as dollar-denominated assets.
Watch my video to learn how you can turn that currency lemon into portfolio lemonade with my No. 1 mutual fund and No. 1 ETF pick, both designed to profit from America’s falling credit rating.
Best wishes,
Tony
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{ 3 comments… read them below or add one }
it seems that the perception about us debt overseas has changed investor are starting to take a second look at their sovereign debt portafolios and start questioning their investements in us bonds that is not good news for us in the us and certainly could trigger stagflation.
What does it take for the Fed and Congress to wake up to the fact that we can no longer spend our way back to prosperity??? I think the China down grade of US paper could be a great motivator in accomplishing better fiscal management. If the government stopped fighting foolish wars and allowing jobs to go to China and the Far East, things may start to improve. There is new developements that may improve our imported energy situation, that being the Navy’s China Lake geothermal energy facility in California about 125 miles north of Los Angeles. Thermal engergy reportedly is even cheaper than hydro-electric and way cheaper than necular. Think about it!! Leland
Let us never forget that Alan Greenspan worried in 2001 that the US would pay off its debt and thus hem in the Fed. Of course, Ben Bernanke has shown that AG was full of shit, the Fed could always find ways of increasing high-powered money other than buying T-bonds. This was the ‘reason’ given for why tax cuts were necessary less than a decade ago!!!
Think about that. The country absolutely needs a strong Keynesian response and all Obama following upon Bush could do was to give us some weak stimulus package following Bush’s anemic tax cut.
The post-Keynesians have been shown to be correct. For more info look at the Levi Institute website.