Bill Holter’s Commentary
…and only days before they start trading oil for yuan, is this a coincidence?
Chinese agency Dagong cuts U.S. sovereign ratings to BBB+ from A-
January 16, 2018
BEIJING (Reuters) – China’s Dagong Global Credit Rating Co, one of the country’s most prominent ratings firms, on Tuesday cut the local and foreign currency sovereign ratings of the United States, citing an increasing reliance on debt in the world’s largest economy.
Dagong said in a statement that it cut the sovereign ratings to BBB+ from A- and also placed them on a negative outlook.
The growing reliance on the debt-driven mode of economic development will continue to erode the solvency of the U.S. federal government, the Beijing-based ratings agency said.
In December, U.S. President Donald Trump signed into law a package of tax cuts that will add $1.4 trillion over a decade to the $20 trillion national debt.
“Deficiencies in the current U.S. political ecology make it difficult for the efficient administration of the federal government, so the national economic development derails from the right track,” Dagong said.
“Massive tax cuts directly reduce the federal government’s sources of debt repayment, therefore further weakens the base of government’s debt repayment.”
The U.S. embassy in Beijing could not immediately comment.
International ratings agencies Fitch and Moody’s Investors Service both give the United States their top AAA ratings. S&P Global has put the U.S. on a slightly lower grade of AA+ since 2011.
DHS Seeking To Charge Leaders Of Sanctuary Cities
January 16, 2018
Homeland Security Secretary Kirstjen Nielsen confirmed Tuesday that her department has asked federal prosecutors to see if they can lodge criminal charges against sanctuary cities that refuse to cooperate with federal deportation efforts.
“The Department of Justice is reviewing what avenues may be available,” Ms. Nielsen told the Senate Judiciary Committee.
Her confirmation came after California’s new sanctuary law went into effect Jan. 1, severely restricting cooperation the state or any of its localities could offer.
U.S. Immigration and Customs Enforcement Director Tom Homan says those policies put his officers and local communities at more risk because they have to arrest illegal immigrants out in the community.