First and foremost, it needs to be made clear that it is impossible for the United States to be forced into default on debt denominated in dollars.
Yesterday, Fitch issued a downgrade of US long-term debt from AAA to AA+. Is there a universe in which this makes sense or is it Fitch that deserves a downgrade?
First and foremost, it needs to be made clear that it is impossible for the United States to be forced into default on debt denominated in dollars. Not unlikely, not improbable, but impossible. However, don’t take my word for it:
“The United States can pay any debt it has because we can always print money to do that. So there is zero probability of default. » Alan Greenspan “In the case of United States, default is absolutely impossible. All U.S. government debt is denominated in U.S. dollar assets.” Peter Zeihan, Vice President of Analysis for STRATFOR
“In the case of governments boasting monetary sovereignty and debt denominated in its own currency, like the United States (but also Japan and the UK), it is technically impossible to fall into debt default.” Erwan Mahe, European asset allocation and options strategies adviser
“There is never a risk of default for a sovereign nation that issues its own free-floating currency and where its debts are denominated in that currency.
