Do Americans get it when a credit rating agency like Moody’s places our debt rating on a downgrade watch?

But, wait – there’s more. We can do it, again.

Ratings agency Moody’s on Wednesday placed the United States’s triple-A debt rating on a downgrade watch because of rising prospects the US debt limit will not be raised in time to avoid default.

“The review of the US government’s bond rating is prompted by the possibility that the debt limit will not be raised in time to prevent a missed payment of interest or principal on outstanding bonds and notes,” Moody’s said in a statement after the US financial markets closed…

Moody’s recalled that it had announced on June 2 that a rating it would be likely “in mid-July unless there was meaningful progress in negotiations to raise the debt limit…”

The agency insisted that even a brief delay in US payments would likely result in a lower rating.

“An actual default, regardless of duration, would fundamentally alter Moody’s assessment of the timeliness of future payments, and a Aaa rating would likely no longer be appropriate,” it said…

The stalemate in Congress is threatening to push the US into defaulting on its obligations by August 2, according to Treasury estimates.

I realize most Americans don’t know the definitions for when a national economy enters or leaves a recession. Everyone would rather leave it to seat-of-the-pants judgements based on commuter traffic, what your kids’ classmates bring for school lunch or how many families in the neighborhood are in foreclosure.

Even the dummies who yammer about a double-dip recession haven’t learned enough economics to know that once you’ve left a recession for an appreciable spell — and the Great Recession ended in June 2009 according to standard metrics — then another recession added onto what we’ve survived one way or another would be exactly that. Another recession. One you can drop into the lap of the Republican Party as surely as you could the preceding.

Americans – who think there’s no reason to pressure the Congressional thugs who don’t care if the United States defaults on our debts – should step back and ask themselves if they want to go through everything that’s happened to this nation’s economy since December 2007 all over again? Only worse?

4 thoughts on “Do Americans get it when a credit rating agency like Moody’s places our debt rating on a downgrade watch?

  1. exult49 says:

    Hi Ed , for once Let me propose you to ruse and report my personal blog with for sure your translation .
    Its title is “The US budget deficit: Perception, Politics, Mithology” . The great idea that you still have as public opinion of the Reganomics and its plain reality.
    As far as your today’s blog I just wish to inform you that beside Moody’s, the China’s Agency of rating just few hours ago commented your deficit as junk! I do not know if my american fellows do really understand where 8 years of George W. brougt the country…….Nice one
    A big hug Giacomo

  2. moss says:

    Seems to me I recall a couple of Republicans bragging about how they won election in 2010 because they were going to turn around the fight for jobs. Looks like they were right. They turned it bloody backwards.

    And this year – they’ve introduced absolutely zero legislation to aid job creation, support the needs of the unemployed. They only have one single topic to discuss: how to keep the 1% of the nation that needs the least help – from paying any of their fair share of taxes.

    • E Trams says:

      I am standing while I applaud this comment.

      Now if someone on the National stage would get in front of the ABC, CBS and NBC cameras and make the same comment (oh have the stations air it); we might all get some relief.

      As a citizen, I feel like the Republicans are pointing a dangerous weapon at me.

  3. keaneo says:

    Standard and Poor’s have added their decision to Moody’s to put the United States on a downgrade watch.

    I was thinking about this as I awoke this morning. What a heap of dung the Republican Party has become when 400 CEOs decide to address the budget negotiations – essentially expressing their lack of trust in the Republikans.

    Their decision to become a body dedicated exclusively to the narrowest interests, the most reactionary elements of corporate America, to satisfy their bible-thumping base of haters, timorous bigots – now puts them at odds with the overwhelming breadth of American capitalism. The folks who may often be greedy bastards; but, they at least are trying to build their business as based in the United States. Even as part of a global economy.

    The Republikans don’t care. Just as the Chamber of Commerce only represents Big Oil and some of the most backwards elements on Wall Street, the Republican Party now is a party of ideology only. Willing to screw their traditional economic class-base as easily as they would the working-class, the middle class of this land.

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