Ben Harris On US Fitch Credit Downgrade

The transcript discusses Fitch's unexpected downgrade of US debt, questioning its timing given recent improvements in governance and fiscal outlook. Fitch's recession prediction is explored, with skepticism about its impact on the US dollar and treasuries. Criticism of Fitch's motives is compared to past downgrades, and the political context is considered, including potential future chaos in Washington.

Why is the timing of Fitch's downgrade considered bizarre?

• Because it was announced during a recession.

• Because it happened during a strong macroeconomic period.

• Because it was expected during the 2017 tax cuts.

• Because it coincided with a government shutdown.

What is Fitch's prediction for the US economy in the near future?

• No recession and strong economic growth.

• A mild recession in the fourth quarter and first quarter of next year.

• A significant economic boom.

• A severe recession in the next quarter.

What was the impact of the Fiscal Responsibility Act on the US fiscal outlook?

• It slightly improved the fiscal outlook.

• It significantly improved the fiscal outlook.

• It worsened the fiscal outlook.

• It had no impact.

How might the downgrade affect the perception of US Treasuries?

• It will significantly weaken the perception.

• It might cause a slight change in perception.

• It will lead to a major sell-off.

• It will have no impact at all.

What criticism has been directed at Fitch regarding the downgrade?

• That it was too early.

• That it was unpatriotic.

• That it was based on outdated data.

• That it was too lenient.

What has been the role of governance in the context of the downgrade?

• Governance has remained unchanged.

• Governance has been ignored by Fitch.

• Governance has improved with bipartisan cooperation.

• Governance has deteriorated significantly.

What was a potential reason for Fitch's downgrade related to political events?

• The upcoming 2024 election.

• The 2017 tax cuts.

• The 2020 election polarization.

• The recent government shutdown.