Yesterday, the tea party was to blame
Today, its the S&P
The US won't default as it can always print money. But what good is a dollar if its purchasing power is halved through rapid inflation? If you buy a 10 year T-bill paying 3%, but inflation rises to 5% next year and every year afterwards, you will effectively get a negative return at the end of the 10 years.
Yahoo: Days after Standard & Poor's downgraded the United States' credit rating, a powerful backlash has set in against the move. Washington leaders of both parties, as well as investors, have seemed to shrug off the ratings agency's verdict--and some analysts have even raised questions about S&P's basic competence and credibility.
On Friday, S&P lowered its rating for long-term debt issued by the U.S. Treasury by one notch, from Triple A--its highest rating--to AA+. Explaining the move, it said Washington hadn't done enough to reduce the long-term deficit, and expressed doubt about the ability of political leaders to work together to solve the problem.
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