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Old 08-05-2023, 07:03 AM
MandoMan MandoMan is offline
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Quote:
Originally Posted by twoplanekid View Post
August 2, 2023

I received the follow email because of my position on the Investment Advisory committee in the Villages.

"Fitch Ratings (Fitch) downgraded its long-term ratings on the United States of America late yesterday, following through on the Ratings Watch Negative assigned on May 25.


In its press release, Fitch cited an expected fiscal deterioration over the next three years, the high and increasing government debt burden, and an erosion in governance standards relative to its “AAA”-rated peers over the last 20 years that has resulted in recurring debt limit standoffs and last-minute resolutions. Fitch also noted the complex federal budgeting process and the government’s lack of a medium-term fiscal framework.


We continue to closely monitor this developing situation and its market impact. Should you have any questions, please reach out to your PFMAM client service professional."
Your source reporting on Fitch seems to have left out something important, or perhaps you did. In his daily business report last Thursday, Andrew Ross Sorkin wrote, “ Richard Francis, Fitch’s primary U.S. analyst, told The Times that a key factor behind the downgrade was America’s intense partisanship, which had led to standoffs on the debt ceiling and forestalls any efforts to reach agreement on taxes or on increasing federal spending. “There is no willingness on any side to really tackle the underlying challenges,” Francis said.”

What scared Fitch was the willingness of members of Congress to refuse to raise the debt limit so the country could pay for debts legally incurred. Their brinksmanship had most of the world-wide business community on edge and had serious effects on the market. This is Fitch’s way of telling Congress to stop doing it and do the right thing, well in advance of when payments are due. Are members of the House proud of doing this? They are costing investors more money than they may possibly have saved with their disgusting tricks.