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?
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To add to what others have already said, in case you are thinking the US can choose to miss a debt repayment, doing so would be one of the last measures the govt resorts to. I don’t know how to give you a good sense, but it would be disastrous for the US and world economy if the US ever defaulted on its debt. The US would sooner choose to print more money. This kind of confidence that the US would never elect to default on debt and has backup measures in the unlikely event things get difficult makes govt debt have such a high credit rating.
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