As if the news can’t get any worse for those who pay attention – Standard and Poor’s changed it’s outlook on the US credit rating from “stable” to”negative”. This is a significant event.
Investing in the United States has long been considered probably the safest most secure investment in the word. This is certainly a step in the opposite direction. It is amazing to me that so many people – such as yourself and now Standard & Poor’s can see the seriousness of the national debt – but Congress can’t seem to get together and do anything about it.
So – why is this important to us preppers? As I have stated many times before – I am no economic expert. My understanding is as confidence erodes in the ability of the United States government to pay back its debts the cost to borrow will increase. Much like if your credit score is not very good – and you go to buy a car – you will have to pay a higher interest rate. The same goes for the US Government. As the government continues to borrow money at an unprecedented rate – the government will have to do so at a higher interest rate.
Now – the US cannot seem to be able to pay down its current debt as it stands now with loans that it has received at very low interest rates. Should the US loose its “AAA” rating (which is exceptional) – the interest rates will increase and effect the national debt in a way which will accelerate its increasing growth.
As for many of us preppers who are concerned about an economic collapse – this is not good news and is just another piece of the puzzle.
Oh – here is a good video that does a good job presenting just how ridiculous our governments fiscal policy is and what a mess we are in:
Keep stocking up folks!