This has to be some of the most significant news of our time. According to the Wall Street Journal in an article found here, Standard and Poor’s has downgraded the United States triple A debt rating. I cannot even fathom what the consequences of this action will be. It is completely unprecedented that an economy as large and once vital as the United States has defaulted on its loans.
One thing is for certain though, interest rates are likely to be increasing for every American on everything here. This is troubling and could possibly lead to further defaults on adjustable rate mortgages as those mortgages are reset with higher interest rates, rather than the lower ones that we have been experiencing lately. This would further strain the ability of the average American to make their payment obligations. All in all, this is terrible news.
On a separate note, I do have to respect the courage that Standard and Poor’s demonstrated by downgrading the United States’ debt rating. I believe that the failure of the ratings agencies such as Standard and Poor’s and Moody’s to properly grade the businesses that led to the overvaluation of many businesses leading up to the economic collapse of 2008.
Thank you for taking the time to read this article by bankruptcy lawyer Glenn Roethler. The views expressed in this article do not reflect those of all the members of Greeves, Price & Roethler, PLC.