There’s Only One Way to Avoid a Downgrade to U.S. Credit
by Washington’s Blog
July 27, 2011
According to Reuters, a majority of economists now think that U.S. credit will be downgraded.
The debt ceiling plans being proposed likely will not avoid a debt downgrade.
Indeed, as Zero Hedge notes, the cuts being proposed in the debt ceiling proposals would be offset by the costs of the downgrade:
The US downgrade alone, now virtually taken for granted by everyone, will offset any beneficial impact from any deficit reduction that will have to happen for the debt ceiling to be increased.
Indeed, many are starting to say that a downgrade is inevitable.
In truth and in fact, we could still avoid a downgrade … but only if we immediately: