It's the end of the world as we know it! I wrote back in 2008 that the world as we know it had ended forever except the world didn't know it quite yet. With the unimaginable now having become reality in the downgrading of US credit rating, the process of the dismantling of the Global Economy will progress much more rapidly. I suspect that by the end of this year, in less than 150 days from now, there may not be a single person on Earth who will not be painfully aware that the world is coming apart at the seams.
S&P cut the long-term U.S. credit rating by one notch to AA-plus on concerns about growing budget deficits.
"The downgrade reflects our opinion that the fiscal consolidation plan that Congress and the administration recently agreed to falls short of what, in our view, would be necessary to stabilize the government's medium-term debt dynamics," S&P said in a statement.
"More broadly, the downgrade reflects our view that the effectiveness, stability, and predictability of American policymaking and political institutions have weakened at a time of ongoing fiscal and economic challenges to a degree more than we envisioned when we assigned a negative outlook to the rating on April 18, 2011," the statement said.
The outlook on the new U.S. credit rating is negative, the S&P said in its statement, a sign that another downgrade is possible in the next 12 to 18 months.