The real story here is how small the downgrade is and how long it took to be issued.
Does any sane person actually think that the USA in its current form will honour its debts if doing so is at all inconvenient to the administration?
IMO the main factor here is the credit agencies being cautious about retaliation from the US government if they make too much noise.
Arnt•27m ago
Oh, sure. Consider the bonds that have to be paid back next Tuesday (assuming there are some). What would happen if those weren't paid back? Do you think it world be practically possible to issue new bonds in the near future?
The rush of not being able to issue new bonds imposes considerable discipline.
eigenspace•4h ago
Does any sane person actually think that the USA in its current form will honour its debts if doing so is at all inconvenient to the administration?
IMO the main factor here is the credit agencies being cautious about retaliation from the US government if they make too much noise.
Arnt•27m ago
The rush of not being able to issue new bonds imposes considerable discipline.