Skip to comments.Fitch warns it may downgrade US over debt standoff
Posted on 01/15/2013 3:00:23 PM PST by SeekAndFind
The United States could lose its top credit rating for the second time from a leading agency if there's a delay in raising the country's debt ceiling, Fitch Ratings warned Tuesday.
Congress has to increase the country's debt limit, which effectively rules how much debt the U.S. can have, by the end of February or face a potential default, Fitch says. There are fears that the debate will descend into the sort of squabbling and political brinkmanship that marked the last effort to raise the ceiling in the summer of 2011. Outgoing U.S. Treasury Secretary Timothy Geithner warned then that it had nearly reached a point where government would be unable "to meet our commitments securely."
"The pressure on the U.S. rating, if anything, is increasing," David Riley, managing director of Fitch Ratings' global sovereigns division said at a London conference. "We thought the 2011 crisis was a one-off event .... if we have a repeat we will place the U.S. rating under review."
If that happens, Riley said there was "a material risk" of the rating coming down, which could mean the U.S. would face steeper costs when it comes to servicing its debt.
If Fitch does move to downgrade the US, it will join Standard & Poor's, which was so concerned by the dysfunctional nature of the 2011 debate that it stripped the U.S. of its triple A rating for the first time in the country's history.
Fitch already has a negative outlook on the U.S. as the country's debt burden has risen to around 100 percent of its annual gross domestic product, and has said it will make a decision on the rating this year, regardless of how the debt ceiling discussions pan out.
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Good. That’ll teach those money-grubbing ba$tards.
I hope so. The only way this ends now is with a train wreck. Better now than later. Smash the throttle forward and make it spectacular.
The parasites will have to learn to work.
Fitch will downgrade no matter what happens. They’ve already said that the key things they generally expect...aren’t being done in solution A or solution B.
Debt Ceiling is the phrase in the Talking Points for the State-Run-Media, as opposed to “out of control spending, with NO BUDGET prepared since his Election, AND, un-Constitutionally conducting spending without a Budget”.