Fitch Ratings has warned it might downgrade U.S. debt in case of default, although legendary investor and commodities bull Jim Rogers says the agency should have done so 15 years ago.
Congress is mulling an increase to the country's $14.3 trillion debt ceiling, and if it fails to do so by August, administration officials say, the United States will default.
Big deal, Rogers says.
"They should have been downgraded years ago. The rating agencies have gotten it wrong for 10-15 years now. America is bankrupt," Rogers tells The Economic Times.
(Getty Images photo)
Furthermore, monetary policy officials in the United States aren't taking rising inflationary pressure seriously, as evidenced by the amount of money they are printing in an effort to fuel more-robust economic activity.
Federal Reserve officials say rising prices of fuel and food are transitory and will level off soon and are sticking with loose policies.
European officials, under the guidance Central Bank President Jean-Claude Trichet, do understand the gravity of mounting inflation rates, Rogers says.
"I wish Mr. Trichet would be running the American central bank, at least he knows if there is inflation in the world," Rogers says.
"The Indian central bank is doing a better job. The European Central Bank is doing a better job than the American. I hope he raises interest rates. It will be good for Europe, it will be good for the world."
Fed Chairman Ben Bernanke has said the economy will pick up during the second half of 2011.
"I expect hiring to pick up from last month's pace as growth strengthens in the second half of the year," Bernanke says, according to MarketWatch.
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