U.S. Debt Downgrade by Chinese Rating Agency Is “Inevitable”
BY BOB ADELMANN
TheNewAmerican.com
A year ago Dagong Global Credit Rating reduced its rating on the sovereign debt of the United States from AA to A+. In August it dropped it another notch to A. In an interview on Saturday the agency’s chairman, Guan Jianzhong, said it is nearly inevitable that the agency will further reduce its rating of U.S. sovereign debt: “We are continuing to monitor this closely. First of all we need to look at this year’s economic growth [in the US] and then predict next year’s trends. If in the year 2012 the overall projections are not very good, meaning that the sources of payment – and liabilities – are bad and cannot be changed, or change for the worse, then we will lower the rating once again.”
This would bring the Chinese agency’s rating on U.S. sovereign debt to BBB, “medium high rating” or just one notch above “junk.”
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