Monday, April 18, 2011
S&P revises U.S. outlook to "negative."
I’ve said for a long time that the rating agencies (idiots) will eventually downgrade US debt even though there is NEVER, EVER, EVER a solvency risk for a nation that issues its own currency and where its debts are denominated in that currency.
However, these are the same IDIOT agencies that rated all the toxic subprime debt AAA, so what do you expect? (Watch the movie, Inside Job for more unbelievably eye opening footage on how corrupt the financial sector AND mainstream economics has become. It will make you sick.)
The rating agencies WILL eventually downgrade the US, just as they did to Japan. (BTW, the bond market has barely moved on this announcement.)
This is just one near-term problem that could be presenting itself for stocks. The other is the debt ceiling. This ratings scare will likely cause Obama to panic and go with MASSIVE spending cuts, making the longer-term outlook somewhat negative.