Chamath Palihapitiya Recalls What Happened When US Last Got A Credit Downgrade: 'Absolutely F**king Nothi

Logo BenzingaBenzinga
2023-05-29 08:19:00  • 5 mins

President Joe Biden and House Republicans reached an agreement over the weekend to suspend the debt ceiling limit for two years. The safe passage of the bill through Congress is clouded with uncertainty as conservative GOP members have expressed their unhappiness over it.

Last week, rating agency Moody's warned of putting the U.S.'s "AAA" credit rating on "negative" watch in the eventuality of the U.S. defaulting without a debt deal.

Chamath Palihapitiya, a Sri Lankan-born Canadian-American venture capitalist and SPAC sponsor, weighed on the threat of a rating downgrade and the potential implication.

What Happened: Palihapitiya suggested in an episode of the AII-In podcast aired on Friday that a credit rating downgrade may not mean much for the economy. He noted that Standard & Poor downgraded the credit rating of the U.S. from "AAA" to "AA+" in August 2011.

"You know what happened? Absolutely f***king nothing," he said.

These downgrades don't mean much, Palihapitiya said, adding that these third-party credit agencies are not particularly that accurate and sophisticated.

Continue read on

A forthcoming report from the World Bank flags increasing levels of consumer debt in Latin America, particularly in Brazil and Chile, which could potentially...
The escalating political turmoil in Washington D.C. has led to a wave of market volatility, with nervous investors offloading stocks and bonds. The situation...
2023-10-04 12:28:12  • 1 min
WASHINGTON President Joe Biden will announce another wave of federal student loan forgiveness on Wednesday, according to a White House official, as borrowers...
2023-10-04 09:01:28  • 1 min
Morgan Stanley has downgraded Egypt's sovereign credit rating, citing several risk factors including an upcoming presidential election, the possibility of a...
2023-10-02 16:40:16  • 1 min
Stocks and bonds have tumbled worldwide, with the 30-year Treasury bill hitting a 16-year high. Investors are worried about the economys health. A growing...
Logo The New York TimesThe New York Times
2023-10-04 11:44:49  • 1 min
Key Points Mortgage payments have become significantly less affordable for homebuyers, according to the Consumer Financial Protection Bureau. Nearly a...
2023-10-04 13:00:01  • 1 min
The World Bank has released a new report titled "Pakistan Development Update: Restoring Fiscal Sustainability," warning of a potentially difficult economic...
Raphael Bostic, President of the Federal Reserve Bank of Atlanta, has indicated that he foresees a single quarter-point rate cut occurring late next year, in...
2023-10-03 17:54:21  • 1 min
The Pentagon warned Congress last week that without a deal for more support for Ukraine, the administration only has enough money left to fund Ukraine's most...
Logo CBS NewsCBS News
2023-10-03 17:34:00  • 1 min
Turmoil on global bond markets pushed government borrowing costs higher across the world yesterday. Investors took fright at the prospect of interest rates...
Logo Daily MailDaily Mail
2023-10-03 21:01:23  • 1 min
After a four-year hiatus, federal student loan repayments are resuming, placing financial pressure on borrowers due to additional debt accrued during the...
2023-10-04 16:02:32  • 1 min
WASHINGTON The Supreme Court on Tuesday seemed likely to preserve the work of the Consumer Financial Protection Bureau against a conservative-led challenge....
2023-10-03 17:32:35  • 1 min
Student loan repayments are beginning again in October, after being on hold since March 2020. Almost all stimulus packages announced during the COVID-19...
Logo NasdaqNasdaq
2023-10-02 18:34:02  • 1 min
Federal Reserve Governor Michael Barr addressed the challenge of maintaining high interest rates to manage inflation while aiming for a 2% target on Monday.... --U.S. stock futures edged broadly lower on Wednesday following a day of losses on Wall Street that dragged the Dow into negative territory for...
2023-10-04 09:11:29  • 1 min
Its a shift for the panel after Cardin took over following the indictment of former Chair Bob Menendez.
2023-10-03 22:09:36  • 1 min
Key Points The world's largest economy is once again facing the prospect of a government shutdown unless lawmakers in Washington can pass a spending bill...
2023-09-27 09:37:18  • 1 min
Theres no House speaker, Republicans are tearing each other to shreds over Kevin McCarthys ouster and another shutdown deadline is less than six weeks away...
2023-10-04 09:00:00  • 1 min
A 20-year-old with a poor rating could rack up 551,787 in interest by the time they are 68 Borrowers with a poor credit score could spend an extra 272,302 on...
Logo Daily MailDaily Mail
2023-10-03 21:01:26  • 1 min
Investors are either less willing or able to finance a dysfunctional U.S. government, and this risks pushing borrowing costs for consumers higher.
Logo FortuneFortune
2023-10-04 12:39:54  • 1 min