Geithner says there is 'no risk' of a downgrade for the US economyUS treasury secretary shrugs off credit rating warning
Larry Elliott, economics editor guardian.co.uk, Tuesday 19 April 2011 19.31 BST Article history
Tim Geithner, the US treasury secretary, shrugged off warnings from a leading ratings agency about the US public finances as he sought to reassure Wall Street that the world's biggest economy would be able to maintain its highly prized AAA rating.
In a media blitz following the announcement by Standard & Poor's that it had revised its outlook on the US from stable to negative, Geithner said there was "no risk" of a downgrade.
The treasury secretary insisted that Washington was serious about reducing the budget deficit, which has ballooned to 115% of GDP after being in small surplus a decade ago. "Actually, I think things are better than they have been if you want to think about the prospects for improving our long-term fiscal position," Geithner told CNBC television.
"If you're looking very carefully at what's happening in Washington you see people on both sides – Democrats and Republicans – agreeing with the president that we have to put in place some reforms now to bring down our long-term deficits," he added.
Geithner told Bloomberg Television that both domestic and foreign investors are still confident in US debt and the stronger growth prospects of the US economy. "You can see that in the price at which we borrow every day, but we have to earn that confidence," Geith- ner explained.
The treasury secretary made it clear he thought it possible for the Obama administration to secure a deal with Democrats and Republicans in Congress to reach a deal to "lock in" targets and mechanisms to cut deficits by a total of $4tn (£2.5tn) over the next 10 to 12 years
Obama's genius shrugges off the rating agencies warning 3 1/2 months ago and now the US is going to be downgraded. :roll: Will somebody PPLLEEEEAAASSSSEEEE fire this tax cheating genuis before there is absolutely nothing left of the US economy :x .