Toxic Brew.
As anticipated, the powerful symbolism of US sovereign debt being stripped of its final AAA credit rating the previous week weighed on stocks and unnerved the bond market on Monday morning.
Trump of course deflected by blaming Biden, but the fact is that a downgrade like this results from the potential fiscal recklessness of this administration and also from foreign investors being driven to look towards their home markets rather than funding US deficits with their money.
The bond vigilantes are definitely beginning to stir. As one analyst put it; “The US government deficit isn’t a problem…
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