S&P warns the US, If you kick the can its a downgrade man!

Posted on June 21, 2011 by

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Obama’s lackluster lack of leadership is seen and felt globally.

As the battle with congress and VP Biden grinds on over the debt ceiling without any input from Obama, outside a round of golf, 1 of about 13 in a row, long looks start to develop around the world about O’s inability to lead or to force the hands of Congress on the debt like he managed to do during the first two years of his the head of the spend it even if we don’t have it progressives 111th congress.  Well those long stares do not come without a cost it seems.  A cost that you and I as citizens will be forced to bear the burden of in the long run as interest rates on the nations debt gets bumped up a percent as our credit rating gets bumped down a percent or two.

“Theoretically, there’s a lot of flexibility on the fiscal and the monetary side: you have a central bank that can expand its balance sheet, and that’s a real boon,” Moritz Kraemer, head of sovereign credit ratings for Europe at Standard & Poor’s, said on Tuesday.

“But the problem is this flexibility needs to be employed and for that you need political consensus. That’s not very visible right now.”

“The downside risks in the medium term have increased and we did assign a negative outlook that signifies there’s a one in three chance the rating might go down in the next few years,” Kraemer told a Euromoney conference in London.

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