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On Friday, Moody’s capitulated. They finally downgraded the US’s credit rating from Aaa to Aa1. In this downgrade, they joined Fitch and Standard & Poor's, which each downgraded the US years ago. That leaves two U.S. institutions with an Aaa credit rating… Microsoft and Johnson & Johnson. Which is to say that it’s safer to lend money to them than to the US. Why the downgrade? Debt, pure and simple. That and our continued inability to do anything about it. Politicians of all stripes are addicted to spending and otherwise using the Treasury to bribe their voters. Even today, the “big beautiful bill” is chock-a-block with giveaways that take effect immediately and “cuts” that start conveniently after the 2028 election… i.e., never. There is nothing now but time between us and a ruinous financial disaster.
Discussion (43)
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Financial disasters come and go. The Soviet Union had a financial disaster. The earth is still turning on its axis. People are still enjoying themselves and making babies. It wasn't the end of the world.
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“It’s the end of the world as we know it. (And I feel fine.) - REM
Let’s see …in the Russian financial crisis of 1998 Russian inflation hit 84%. Banks failed. People lost their savings. It brought us Putin eventually. It wasn’t worse because Russia is a net exporter and the cratering ruble helped their exports.
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Trump Derangment Syndrome is preventing the spenders from seeing what a gift DOGE is. If Elon were allowed to find that bogus trillion and thus preserve the health of all the programs that matter to voters (unlike insider grift like USAID), that would prevent that big clownshow on the hill from having to make significant cuts sooner and may even help to foster enough economic growth to increase revenues without new taxes and at least stop the bleeding.
Attacking Musk rather than let Trump do anything positive is malignant insanity.
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True. So is spending more money we don’t have.
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Verily.
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