Propublica:
The U.S. still has a higher per-capita GDP than most countries, including both the U.K. and France. Last year, the U.S. GDP grew 2.9 percent—almost double the U.K.’s 1.4 percent and France’s 1.5 percent. Between April and June of this year, the U.S. GDP grew 1.3 percent while the U.K. economy grew 0.2 percent. A June forecast from the Bank of France estimated that the country’s economy would grow 0.4 percent in the second quarter. (U.S. growth, granted, is still slower than it used to be.)
As a percentage of GDP, both the U.K. and France have a higher percentage of external debt, or debt owed to outside bondholders. In 2010—the latest year for which the Organization for Economic Cooperation and Development has numbers—U.S. external debt was 61 percent of GDP, compared to France’s 67 percent and the U.K.’s 86 percent. Austria also maintains a lowest-risk rating from all three firms, and its external debt was 66 percent of GDP last year.
Let’s not forget unemployment. Our July 2011 unemployment rate figure was 9.1 percent. That’s higher than the U.K.’s, which has hovered around 7.7 percent, but it’s lower than France, which had 9.7 percent unemployment in June.
S&P, in explaining the historic downgrade—the first in U.S. history—cited both the U.S. debt burden and the political brinksmanship over the debt ceiling as reasons it lowered the credit rating of the United States to AA+, with a negative outlook.
So what do the ratings mean, really? It seems to be a question that economists and investors are asking, too.
“France is not, in my view, a AAA country,” a UBS economist told Bloomberg. And yet there are no indications that France will face a downgrade, the Wall Street Journal reports. In fact, all three of the rating agencies recently affirmed France’s triple-As.
The U.S. still has a higher per-capita GDP than most countries, including both the U.K. and France. Last year, the U.S. GDP grew 2.9 percent—almost double the U.K.’s 1.4 percent and France’s 1.5 percent. Between April and June of this year, the U.S. GDP grew 1.3 percent while the U.K. economy grew 0.2 percent. A June forecast from the Bank of France estimated that the country’s economy would grow 0.4 percent in the second quarter. (U.S. growth, granted, is still slower than it used to be.)
As a percentage of GDP, both the U.K. and France have a higher percentage of external debt, or debt owed to outside bondholders. In 2010—the latest year for which the Organization for Economic Cooperation and Development has numbers—U.S. external debt was 61 percent of GDP, compared to France’s 67 percent and the U.K.’s 86 percent. Austria also maintains a lowest-risk rating from all three firms, and its external debt was 66 percent of GDP last year.
Let’s not forget unemployment. Our July 2011 unemployment rate figure was 9.1 percent. That’s higher than the U.K.’s, which has hovered around 7.7 percent, but it’s lower than France, which had 9.7 percent unemployment in June.
S&P, in explaining the historic downgrade—the first in U.S. history—cited both the U.S. debt burden and the political brinksmanship over the debt ceiling as reasons it lowered the credit rating of the United States to AA+, with a negative outlook.
So what do the ratings mean, really? It seems to be a question that economists and investors are asking, too.
“France is not, in my view, a AAA country,” a UBS economist told Bloomberg. And yet there are no indications that France will face a downgrade, the Wall Street Journal reports. In fact, all three of the rating agencies recently affirmed France’s triple-As.
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