JPMorgan Chase CEO Jamie Dimon in an interview with CNBC called the Fitch Ratings downgrade of the U.S. long-term credit rating is ridiculous and added that the rating does not matter as it is the market, not rating agencies, that determines borrowing costs.
He elaborated that it is crazy that other countries have higher credit ratings than the U.S., especially when those countries depend on the stability created by the U.S. and its military.
Australia, Denmark, Germany, Luxembourg, Netherlands, Switzerland, Norway, Sweden, European Union and Singapore are the countries receiving AAA credit ratings by Fitch Ratings. All of the above nations except the EU also receive AAA ratings from S&P, while the U.S. has AA+ rating.
“To have them be triple-A and not America is kind of ridiculous,” Dimon said, citing that the U.S. is still the most prosperous nation in the world.
The downgrade drew some comments among the U.S. top officers. U.S. Treasury Secretary Janet Yellen voiced her disagreement with Fitch’s downgrade, calling it “arbitrary and based on outdated data.”
Meanwhile, the White House also had a similar view, saying it “strongly disagrees with this decision”.
Yesterday, Fitch Ratings downgraded the United States’ long-term foreign currency credit rating to AA+ from AAA on Tuesday, which drew angry responses from the White House over the decision.
The world’s top credit agency points to fiscal deterioration over the next three years and repeated debt-limit political standoffs as well as last-minute resolutions have eroded confidence in fiscal management and threaten the government’s ability to pay its debts.