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Credit Ratings Agencies Threaten to Downgrade America

By on November 16, 2012

 

Ratings Agency, Standard & Poor’s

It has been a while Since the United States of America came under the fire of the three major credit rating agencies who have become renowned for rating Nations and their viability in becoming major economic players in the globe.

But with the political rift between the  Democrats and Republicans  over the future economic policies and budgetary plans, the precious AAA rating of the United States could be lost if drastic steps are not taken to avoid a fiscal cliff by 2013.

One of the key credit rating agencies Standard & Poor’s had earlier this year downgraded India one of the powerful emerging economic tigers in the globe, and the downgrading was attributed to the politicization of the economic growth level, but Finance minister  Chidambaram is convinced that the Nation will bounce back.

For the United States the time may have come for the White House and Congress to step up to resolve their impasse or face a painful ‘fiscal cliff’ era which the citizens would find hard to cope with.

At the moment if no budget deal is reached by January, 2013 the Managing Director at Moody’s  sovereign risk group  Bart Osterveld  believes that if the fiscal issue are not resolved then the downgrading of the major global economy would be imminent.

The Global market has been fluctuating because of the fear and  concerns over the stability of the U.S economy. With the Eurozone already sliding into the recession the Obama administration know that every avenue has to be explored to ensure that this dreaded economic term does not hijack the Nation’s Political economy.

The expiration of the $600 billion worth of Bush-era tax  breaks and automatic spending cuts are set to kick in on January 1,2013. Economic scholars and policy makers  assert that the Politicians  should not risk the ‘Fiscal Cliff’ as it would plunge the U.S into a terrible round of recession.

America’s future now hinges on how its Political leaders manage their ideological differences because for an economy with $16 trillion debt burden at the moment, it knows that if it does not get it right, being the major economic player in the Globe could be lost.