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Moody's Lowers U.S. Credit Rating As Debt Nears $37 Trillion, Here's Why

1. Moody's downgraded U.S. credit rating from AAA to AA1. 2. U.S. national debt nears $37 trillion, raising concern over fiscal strength. 3. Debt-to-GDP ratio currently stands at 133.35%, a historical high. 4. Spending consistently exceeds revenue, worsening budget deficits. 5. President's tax plan may increase deficits by $4-6 trillion over a decade.

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FAQ

Why Bearish?

The downgrade in credit rating undermines investor confidence, historically linked with market declines.

How important is it?

The economic indicators and fiscal policies discussed heavily influence S&P 500 performance, signaling broader market implications.

Why Long Term?

Credit downgrades have prolonged adverse effects, as seen in previous fiscal crises leading to sustained market downturns.

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