BRACE YOURSELF: Moodyâ€™s Basically Just Threatened To Downgrade The US
Jan 28, 2011
A day after S&P downgraded Japanâ€™s debt, the attention turns to the US.
Bloomberg cites a new Moodyâ€™s note:
â€śAlthough no rating action is contemplated at this time, the time frame for possible future actions appears to be shortening, and the probability of assigning a negative outlook in the coming two years is rising,â€ť wrote Steven Hess, a senior credit officer in New York and the author of the report. The rating remains â€śstable,â€ť according to the report.
Whatâ€™s really surprising here is that there is an imminent threat of default in the US, which is the debt ceiling drama. Surely that warrants some kind of warning, no? Surely thatâ€™s a bigger threat than the notion that the US might run out of its own dollars.
Apparently Moodyâ€™s doesnâ€™t think so. Anyway, even if it does happen, we doubt that itâ€™s going to be a big deal.