China’s Dagong Credit Rating Agency Downgrades US Credit Rating
China’s Dagong Global Credit Rating Company downgraded the US economy from A+ to A following the passage of the debt deal yesterday. The company said the deal doesn’t change the fact that U.S. debt growth has outpaced its economy and fiscal revenue.
The AP reported:
A little-known Chinese ratings agency has downgraded the rating of the United States from A+ to A. The move is unlikely to affect U.S. borrowing rates but reflects the pessimism Washington’s debt battle has generated worldwide.
President Barack Obama signed emergency legislation to boost the debt ceiling ahead of a deadline to avoid an unprecedented national default.
Still, China’s Dagong Global Credit Rating Co. said Wednesday that the deal doesn’t change the fact that U.S. debt growth has outpaced its economy and fiscal revenue.
Dagong is little-known outside China but hopes to compete with global ratings agencies Moody’s, Standard & Poor’s and Fitch.
Zero Hedge added that Dagong’s decision was spot on: “The decision to lift the debt ceiling will not change the fact that the U.S. national debt growth has outpaced that of its overall economy and fiscal revenue, which will lead to a decline in its debt-paying ability.
And yet conservatives are called “terrorists” for wanting to cut spending.