![]() ![]() ![]() Paulson said the debt is not an immediate worry. I strongly disagree with Fitch’s decision, and I believe it is entirely unwarranted,” Treasury Secretary Janet Yellen said Wednesday. “Fitch’s decision is puzzling in light of the economic strength we see in the United States. Inflation is at its lowest point in more than two years, and it appears increasingly likely the economy experiences a “soft landing,” rather than slumps into a recession. Leading economists have largely denounced Fitch’s downgrade by citing positive indicators. But the deal was struck after months of deadlock on Capitol Hill that threatened to hurl the country into default, highlighting the unproductive brinkmanship that underlies debt negotiations in Congress. The downgrade came after a last-minute bipartisan deal in June that suspended the US debt ceiling until early 2025. “But it’s in some ways a very important wake-up call.” “It’s too bad (the downgrade) came right after we had a bipartisan (agreement) to deal with the debt limit,” said Henry Paulson, who headed the Treasury Department under George W. Last week, Fitch Ratings, one of the world’s top credit rating’s agencies, downgraded the US government’s credit rating from a stellar AAA to an AA+ due in part to “the erosion of governance … over the last two decades that has manifested in repeated debt limit standoffs and last-minute resolutions.” The US economy is resilient, but policymakers need to take the long view on the country’s fiscal challenges, three former Treasury secretaries told CNN’s Fareed Zakaria on Sunday.
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