MEGAN MCARDLE ON U.S. CREDITWORTHINESS:
If at any point we are not seen as the safest game in town, we will take a gigantic–the better word might be “catastrophic”–hit on our bond interest. If there’s somewhere safer to park our money, suddenly we lose the premium we currently enjoy for having bonds considered the “risk free” rate. So while our super-sterling credit rating may delay the onset of a fiscal crisis, if we ever let it get to that point, the onset may be even more sudden and disastrous than these things usually are. All the more reason to start getting our fiscal house in order now.
Not much sign of that.
UPDATE: Reader Bob McDonald writes: “You can bet that when the US loses its super-sterling credit rating, the blame will fall on ‘evil speculators.'”
Yeah, couldn’t possibly be the fault of greedy, profligate politicians who ignored warning after warning.
ANOTHER UPDATE: From reader Greg Marquez, praise for Obama’s cunning plan:
If our credit rating depends upon us being the safest game in town, that may help explain President Obama’s foreign policy. By making the world a more dangerous place he makes investing in the world’s only superpower that much more appealing. The man is a genius.
It all makes sense, now. . . .