Anyone who doesn’t think we are going to lose our AAA is S T U P I D.
The rating agencies will downgrade the US when the Obama administration decides they should do so.
The rating agencies used to be independent, private businesses who issued ratings.
With the Democrats' new regime of regulation, the rating agencies have been de facto brought under the thumb of the US regulatory structure. They now exist at the sufferance of regulators and will play the tune the Obama administration wants.
If they issue a downgrade, it is because the Obama administration has determined that it is politically advantageous to the Dems to do so.
In reality, the creditworthiness of the US government was dinged some time ago by the combination of Democrat control of Congress in 2006 and the presidency in 2008 and the creation of the housing bubble, which destroyed trillions of dollars of national wealth.
I agree - it is inevitable that we lose our AAA rating. Jim Rogers began shorting USD last month, PIMCO began dumping treasuries long before that. The dollar is finished unless we have significant austerity measures in place this summer - we all know what the likelihood of that occurring is. China is ammused as they have been dumping USD for years — some say they’ve dumped about 1/2 of their holdings now. The dumping is actually spending in the form of long term resource/commodity aquisitions. These are a not matter of single upfront payments but payments over time, in USD. When those dollars hit the 3rd world, they will effectively be going from the deep freeze (China’s reserves) to high velocity. If we are not already in hyperinflation due to loss of confidence, this increase in velocity as latent price inflation goes to manifest will get things rolling.
Anyone who doesn’t think we are going to lose our AAA is S T U P I D.