Monday, August 8, 2011

Moody's stands by the US

Moody’s Top U.S. Rating Rebuts S&P

Moody’s Investors Service affirmed the U.S.’s top rating for the second time in a week, rebuttingStandard & Poor’s after it stripped the world’s largest economy of its top credit status.
The U.S. today retained its Aaa ranking with a negative outlook in part because the dollar’s status as the main reserve currency allows it to support higher debt levels than other countries, Moody’s said today in a report. Lawmakers last week took a “positive step” toward addressing the nation’s record deficits, Steven Hess, the senior credit officer at Moody’s inNew York, said in a telephone interview.
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Comment: Nice argument. In fact as long as the US can maintain its status as the undisputed provider of the international reserve currency, its debt potential is indeed unlimited.

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