Is the US Credit Rating Downgrade a Nothingburger?

The Breakdown

Blockworks

Investing, Business

4.8 • 806 Ratings

🗓️ 2 August 2023

⏱️ 16 minutes

🔗️ Recording | iTunes | RSS

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Summary

NLW explores a range of reactions to Fitch's decision to downgrade US sovereign debt from AAA to AA+ from the political responses to the market response to the shoulder shrug of people who don't think it's really possible to compare the US to anyone else. Today's Episode Sponsored By: In Wolf's Clothing -- The first startup accelerator exclusively for Bitcoin and Lightning startups -- Applications for Cohort 3 open NOW -- https://wolfnyc.com/apply ** Enjoying this content? SUBSCRIBE to the Podcast: https://pod.link/1438693620 Watch on YouTube: https://www.youtube.com/nathanielwhittemorecrypto Subscribeto the newsletter: https://breakdown.beehiiv.com/ Join the discussion: https://discord.gg/VrKRrfKCz8 Follow on Twitter: NLW: https://twitter.com/nlw Breakdown: https://twitter.com/BreakdownNLW

Transcript

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0:00.0	Welcome back to The Breakdown with me, NLW.
0:09.3	It's a daily podcast on macro, Bitcoin, and the big picture power shifts remaking our world.
0:18.4	What's going on, guys? It is Wednesday, August 2nd, and today we are talking about the U.S. debt
0:24.0	being downgraded. Before we get into that, however, if you are enjoying the breakdown, please go
0:29.0	subscribe to it, give it a rating, give it a review, or if you want to dive deeper into the conversation,
0:33.6	come join us on the breakers discord. You can find a link in the show notes or go to bit.ly slash breakdown pod. Hello friends, it is a macro day here on the breakdown. We're going to be
0:45.4	talking all about this U.S. sovereign debt downgrade and what it means and the different
0:49.9	interpretations of it. But before we do, on a day where Michael Saylor has decided to try to buy
0:54.9	another three quarters of a billion dollars of Bitcoin, I want to one more time urge you guys to go
1:00.7	check out the in Wolf's clothing Bitcoin Accelerator. Wolf, as you have heard, is the first
1:06.0	accelerator dedicated entirely to Bitcoin and Lightning startups. They are just about to close applications
1:11.8	for their third cohort this Friday. And if you are building or interested in building a company
1:16.9	in the Bitcoin and Lightning space, or maybe you want to deal with something new like
1:20.3	Ordinals that surrounds it, this is the support program for you. Go to Wolfnoyc.com to learn
1:26.3	more and to potentially apply. Thanks to Wolf for supporting
1:29.5	the show. Now, to today's main topic. Yesterday, ratings agency Fitch downgraded U.S. sovereign
1:37.1	debt. The firm cited ballooning budget deficits and the deteriorating state of governance across
1:42.2	the nation. Now, Fitch had flagged back in May that it was
1:45.3	considering a downgrade during the debt ceiling standoff, but didn't act on their concerns. The
1:50.9	downgrade cut the U.S. government's rating by one level from AAA to AA plus. This move echoes a
1:56.9	controversial downgrade by fellow ratings agency's standard and pores days after the resolution
2:01.2	of the 2011 debt ceiling crisis. S&P has maintained that lower rating for the U.S. government
	...

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