US will eventually lose AAA credit rating, top investor says

US will eventually lose AAA credit rating, top investor says

The co-chief investment officer of the world’s largest bond fund said the US will eventually lose its top AAA credit rating the same day that Standard and Poor’s rating service downgraded Britain’s national debt from stable to negative.

The US will likely be downgraded in “at least three to four years, if that, but the market will recognize the problems before the rating services – just like it did today,” said Bill Gross of Pacific Investment Management Co.

Thursday’s market declines, Gross said, reflect the fact that investors fear the United States is “going the way of the UK – losing AAA rating which affects all financial assets and the dollar.”

Britain’s debt is approaching 100 percent of its gross domestic product. Standard and Poor’s says it “faces a one in three chance of a ratings cut.”

via Raw Story » US will eventually lose AAA credit rating, top investor says.