Editor’s Note: I knew this was coming and now it is much closer to a reality with “Mr. Bond” himself Bill Gross saying it. All I personally was waiting for was the economy to think it was actually recovery and then we would see people flee out of the dollar safe haven trade and that would make the dollar plummet.
This does not bode well for the U.S. as we intend to finance trillions of dollars of new debt. Our borrowing costs are going to soar just at the time when some of our unfunded liabilities are coming to bare on the U.S. I hope all these bailouts were worth it. If it was me, I would of let the market players collapse and I would of defended the dollar no matter what because that is one of our greatest assets but it seems that we are instead sacrificing the dollar and would rather deal with rampant price inflation that at this point is baked into the recovery. Good luck
News (Bloomberg):
Bill Gross, the co-chief investment officer of Pacific Investment Management Co., said the U.S. “eventually” will lose its AAA rating, but not any time soon.
“It’s certainly nothing that’s going to happen overnight,” Newport Beach, California-based Gross said in an interview today on Bloomberg Television. “The markets are beginning to anticipate the possibility.”
Standard & Poor’s lowered its outlook on the U.K.’s AAA credit rating today to “negative” from “stable” and said the nation faces a one-in-three chance of a rating cut as its debt approaches 100 percent of gross domestic product. U.S. marketable debt is at about 45 percent of GDP, according to Bloomberg data.
A downgrade was not “imminent,” Gross earlier told CNBC after Reuters reported he said via e-mail the U.S. dollar, equities and government bonds fell on speculation the nation is at risk of losing its top credit rating.
You must log in to post a comment.