The Fed Has Laid the Seeds of a Crisis That Wall Street Can No Longer Ignore

In a concerning move, Fitch downgraded America’s credit rating, emphasizing the country’s growing financial vulnerability due to prolonged Washington dysfunction. The Fed’s attempts to combat inflation might be setting the stage for a major fiscal crisis. Historical investment patterns, which favored stocks and bonds over short-term government securities, are now in question. Ray Dalio, a prominent hedge fund figure, now advocates for cash over stocks or bonds. U.S. debt is set to exceed the country’s GDP, and even minor deviations in financial projections could lead to trillions in additional federal debt. With constraints on America’s financial flexibility, its global standing and economic stability are at risk.