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
The credit rating reflects the agencies opinion of how likely an issuer will default (not pay). The US is unlikely to not pay its bills. At least according to the ratios agencies.
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We are a stable, advanced economy. We pay our debt, 100% of the time. Nobody is afraid that buying U.S. debt is too risky.
The credit rating reflects the agencies opinion of how likely an issuer will default (not pay). The US is unlikely to not pay its bills. At least according to the ratios agencies.
Because the USA has been really really good at paying back that debt.
As long as that continues, institutions will always trust that the government will continue to pay its debts and therefore give it a good rating.
[removed]
We are a stable, advanced economy. We pay our debt, 100% of the time. Nobody is afraid that buying U.S. debt is too risky.
We are a stable, advanced economy. We pay our debt, 100% of the time. Nobody is afraid that buying U.S. debt is too risky.
The credit rating reflects the agencies opinion of how likely an issuer will default (not pay). The US is unlikely to not pay its bills. At least according to the ratios agencies.
Because the USA has been really really good at paying back that debt.
As long as that continues, institutions will always trust that the government will continue to pay its debts and therefore give it a good rating.
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