Moody’s Investors Service downgraded the U.S. government credit rating from the top-level Aaa to Aa1, saying this “reflects the increase over more than a decade in government debt and interest payment ratios to levels significantly higher than similarly rated sovereigns.”
That comes over a year after Moody’s lowered its outlook on the U.S. debt rating to negative. Fitch Ratings and S&P Global Ratings had already stripped the U.S. government of its top credit ratings.
Speaking on NBC’s Meet the Press on Sunday, Treasury Secretary Scott Bessent said, “Moody’s is a lagging indicator.”
It is true that our debt is high, but my takeaway is that this pullback will not last long.
The market went from deeply oversold to short-term overbought quickly.
Sometimes, all it takes is a headline to stall it out. The path back to all-time highs is still in the cards, but as always, expect some bumps along the way.
Seeing where the bulls step up to support the market and start nibbling the dip will be interesting.
See you in the chat room. If you need a link to the chat room, email me.