By Chriss W. Street
Orange County Treasurer

Despite my testimony last May and repeated warnings from Moody’s, S&P et al that the U.S. could lose its top credit rating with ongoing fiscal deficits and heavy debts, the platinum-plated AAA rating of the United States seemed all but untouchable, until it was downgraded today to AA by Beijing based rating agency–Dagong International Credit Rating Co. due to:

“The reason for the global financial crisis and debt crisis in Europe is that the current international credit rating system does not correctly reveal the debtor’s repayment ability.”

Dubbed as the world’s first “non-Western” sovereign credit rating agency, in its debut international report, Dagone (means Big Justice in Chinese) downshifted the US to AA with a negative outlook, while UK and France were given AA-; Belgium, Spain, Italy with A-.
It also rates debt risk of the US above China, and listed the US as one of the countries with exposure to increasing borrowing costs and default risks.