Ep #193 - What the US Debt Downgrade Means for Stock & Bond Markets

Grow Money Business with Grant Bledsoe

It’s been in the news recently that the rating was downgraded from the highest possible level of AAA to the next level down, AA+, by one of the three major independent organizations that evaluate creditworthiness in the US. We dedicated this week’s episode of the Grow Money Business podcast to discussing what the US Debt Downgrade Means for Stock and Bond Markets.

[03.13] The bond market – Starting the conversation, Grant explains why the bond market is way larger than the stock market.

[10.24] US government debt – We talk about why it is safe to buy US government debt.

[22.13] Has this happened before – We dive into the last time that the US government debt was downgraded.

[29.00] Investment mandates – Grant shares his knowledge about the investment mandates regarding the US government debt.

[38.49] The fault of the system - More debt means higher interest rates and a greater percentage of annual tax revenues going toward debt servicing.

Resources

Credit downgrade shocks Biden aides, as more debt fights loom

washingtonpost.com/business/2023/08/02/us-credit-rating-fitch-downgrade-debt/

U.S. debt downgrade sinks global markets — but economists are not concerned

cnbc.com/2023/08/02/us-debt-downgrade-sinks-global-markets-but-economists-are-not-concerned.html

America’s credit rating got downgraded again. Here’s what happened the last time

edition.cnn.com/2023/08/02/investing/premarket-stocks-trading/index.html