The new regime speaking factors are out – specifically that Fitch downgraded the US credit standing from AAA to AA+ on Tuesday due to MAGA Republicans and all issues Trump.
But whereas Fitch cited “the expected fiscal deterioration over the next three years, a high and growing general government debt burden, and the erosion of governance relative to ‘AA’ and ‘AAA’ rated peers” as causes for the downgrade, the Biden administration is in fact blaming Donald Trump and his supporters because of one portion of Fitch’s rationalization: “a steady deterioration in standards of governance over the last 20 years,” and that “repeated debt-limit political standoffs and last-minute resolutions have eroded confidence in fiscal management.”
Then on Wednesday, Fitch’s Richard Francis instructed Reuters that the downgrade was ‘because of fiscal considerations and a deterioration in U.S governance in addition to polarization which was mirrored partly by the Jan. 6 rebellion.’
“It was something that we highlighted because it just is a reflection of the deterioration in governance, it’s one of many,” he mentioned, including “You have the debt ceiling, you have Jan. 6. Clearly, if you look at polarization with both parties … the Democrats have gone further left and Republicans further right, so the middle is kind of falling apart basically.”
And so in fact, the Biden administration is blaming Trump.
“This Trump downgrade is a direct result of an extreme MAGA Republican agenda defined by chaos, callousness, and recklessness that Americans continue to reject,” mentioned Biden re-election marketing campaign spokesman Kevin Munoz. “Donald Trump oversaw the loss of millions of American jobs, and ballooned the deficit with the disastrous tax cuts for the wealthy and big corporations.”
Ah, so now it is the Trump downgrade™
Meanwhile, White House spox Karine Jean-Pierre additionally blamed Trump on Tuesday, saying that the White House “strongly” disagrees with the choice, including “it’s clear that extremism by Republican officials — from cheerleading default, to undermining governance and democracy, to seeking to extend deficit-busting tax giveaways for the wealthy and corporations — is a continued threat to our economy.”
Biden administration officers shared their disagreement with Fitch forward of an announcement on Tuesday, officers inform reporters: BBG
Biden threatened to withhold $1 billion in support to Fitch if Bidenomics was downgraded?
— zerohedge (@zerohedge) August 1, 2023
Former Clinton Treasury Secretary Larry Summers known as the choice “bizarre and inept,” whereas former Obama financial advisor Jason Furman known as the transfer “completely absurd.”
On Wednesday, CNBC wheeled out Jared Bernstein, chair of Biden’s Council of Economic Advisers and former Obama official, who equally blamed Trump.
“I think again the timing issue is is Jermaine here. The deficit went up every year under President Trump. The debt to GDP ratio rocketed under President trump. It has stabilized admittedly at a higher level under this president but we’re doing all we can to try to ameliorate those tensions,” he mentioned.
Bernstein mirrored on the “cognitive dissonance” he felt on the downgrade amid the success of ‘Bidenomics’ commenting that “creditworthiness deteriorated significantly under President Trump for good reasons… and under President Biden, it started to track back up…”
Except that is the precise reverse of what occurred. According to the 100% non-partisan “market”, the creditworthiness of US Treasury debt improved virtually consistently underneath President Trump and worsened dramatically virtually instantly upon President Biden’s inauguration:
Treasury Secretary Janet Yellen mentioned that the downgrade was “arbitrary and based on outdated data,” including “Today, the unemployment rate is near historic lows, inflation has come down significantly since last summer, and last week’s GDP report shows that the U.S. economy continues to grow.”
Yellen Says Fitch Downgrade Based on Outdated Data
She’s proper: US curiosity expense is not $500 billion, it’s $1 trillion now
— zerohedge (@zerohedge) August 1, 2023
CNN additionally blamed Trump, penning the headline: “Fitch downgrades US debt on debt ceiling drama and Jan. 6 insurrection.”
Meanwhile, some mild studying for premium ZH subscribers.
In mild of the downgrade with Fitch blamed on fiscal unsustainability, a repost:
Here Is The $1 Trillion “Stealth Stimulus” Behind Bidenomicshttps://t.co/OqgQIgN6MR
— zerohedge (@zerohedge) August 2, 2023