Full faith and credit of the United States

Great Seal (Reverse)

To those of you who noticed the downgrade of U.S. Government sovereign debt by Standard & Poor’s from AAA to AA+ on Friday I say the following. Standard & Poor’s is a private company, and its opinion has no bearing on the quality of U.S. Government sovereign debt. The quality is governed only by the “Full faith and credit” clause of the United States Constitution. Numerous court opinions, including from the Supreme Court, have affirmed the absolute primary obligation of the United States for the timely payment of interest and principal on all such debt. To bet that the United States will ever default on this primary obligation is a fool’s bet.

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