Does S&P Action On US Debt Pressure Congress?

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Congress and the Administration may finally be under the outside pressure to deal with the budget deficit that has not been bought upon them by voter sentiment, economist comments, or concerns from the Federal Reserve

“Standard & Poor’s Ratings Services said today that it affirmed its ‘AAA’ long-term and ‘A-1+’ short-term sovereign credit ratings on the U.S. Standard & Poor’s also said that it revised its outlook on the long-term rating of the U.S. sovereign to negative from stable,” the credit firm said.  Standard & Poor’s credit analyst Nikola G. Swann stated “More than two years after the beginning of the recent crisis, U.S. policymakers have still not agreed on how to reverse recent fiscal deterioration or address longer-term fiscal pressures.”

Buyers of US paper will likely react poorly to the comments, but Treasury rate may not rise, at least for now. American debt is still considered a safe harbor and unrest in other parts of the world will likely cause that sentiment to remain

Douglas A. McIntyre