Why is the US’ credit rating so exceptional despite the amount of debt it takes on?

Question

I’m a United States citizen. Moody gives the US a AA+ credit rating (it was downgraded from AAA in 2011).

How can this be, despite the substantial amount of debt the US holds that only continues to grow?

Is it GDP, defense capabilities, the dollar being the de facto currency almost worldwide? A combination of these? Or is there another huge factor(s) I am missing?

In: 54

Answer 1

US government debt has the credit of the US government, which is seen as the most stable (*I know*) in the world, and the backing of the US economy. What’s more, the debt is denominated in US dollars, the world’s reserve currency, and the US prints the money. Therefore, US gov’t debt has zero *credit risk*.