Opening Position  |  AUG 2011

Opening Position

As I write this, I am waiting for the White House and Congress to strike a deal to raise the US debt ceiling. The outcome could worsen the current economic situation not just in the US but globally as well. Think of it: Most of the world’s advanced nations have racked up enormous debt. At least the US still has the highest ratings from credit rating agencies — until now, anyway — as it too risks a downgrade from its Aaa rating. That’s a big deal. Could the world’s economic powerhouse really crash? It’s inconceivable to consider that such a thing might happen. But if it really did, we would see continued weakening of the US dollar, rising interest rates, increasing inflation, and a deep global recession. The clock is ticking, and we are nervously awaiting the outcome. Their decision will affect us all.

by Jayanthi Gopalakrishnan