Fitch Places United States’ ‘aaa’ On Rating Watch Negative

Cowen writes: The U.S. is experiencing ever greater economic inequality and the thinning of its middle class; Texas is already one of our most unequal states. Americas safety net is fraying under the weight of ballooning Social Security and Medicare costs; Texas safety net was built frayed. Americans are seeking a cheaper cost of living and a less regulated climate in which to do business; Texas has those in spades. And did we mention theres no state income tax? Cheap living is luring people to Texas along with jobs, he writes, saying Texas added 12 percent of all jobs nationwide with 274,700. The Americans heading to Texas and other cheap-living states are a bit like the mythical cowboys of our pastself-reliant, for better or worse, he writes. He acknowledges major downsides: Many Americans will have to downsize their living quarters involuntarily. People in the shrinking middle class who want to have more than one child may find the costs too high. There is no longer the expectation, much less the guarantee, that living standards double or even increase much with each generation. But its not all bad newsespecially if we take the right steps to prepare. The flood of Americans moving to Texas shows us where we need to focus our attention; what these migrants have found in Texas shows us ways many of our cities and states can improve. He says the public education system must be more rigorous, and other states also can incorporate some of the lessons Texas has to teach. He says states could deregulate building in order to lower costs (San Francisco needs to become more like Houston when it comes to zoning) and cut down on occupational licensing.

United States to be surprisingly strong for Sunday’s Australia friendly

to name 25 players for games where only 18 will dress. The team named a squad that can straddle the international window. The U.S., however, are set to benefit from Tyresos misfortune, the Swedish club having lost their chance to take first place in the Damallsvenskan. That means the suddenly huge American enclave playing just outside Stockholm will join the team ahead of Sundays game in San Antonio. Reportedly flying straight from their teams Champions League match in Paris , Whitey Engen, Ali Krieger, Meghan Klingenberg, and Christen Press will be available for selection on Sunday, Tyreso having given them permission to miss the weekends season finale at Linkoping. That means Press wont have a chance to build a campaign that win claim Swedens scoring title. With 23 goals in 20 games, the Stanford alum is seven ahead of Linkopings Pernille Mosegaard-Harder, having scored 40 times (in 41 games) since moving to Sweden two years ago. Although she had scored eight goals as a rookie in Womens Professional Soccers final season (2011), few saw this kind of dominance in Presss game during her first professional debut. Her move abroad shows the type of benefits players can see when challenging themselves in Europes best leagues. Despite that success, Press is still fighting for regular time with the U.S., her relatively recent inclusion with the national team creating a game of catch up. Current FIFA Player of the Year Abby Wambach remains the well-established focal point, and Alex Morgans the strike forces other attacking star, leaving Sydney Leroux (despite 21 goals in 39 appearances) is in the same boat as Press fighting for time in the worlds deepest strike force. Christen Press, seen here embracing U.S. national team teammate Carli Lloyd, had 23 goals this season for Tyreso in Sweden.

(Photo-illustration/ Sarah Illenberger for TIME)

– The ‘AAA’ rating also reflects the halving of the federal budget deficit since 2010, which is now approaching a level consistent with debt stabilisation. The Budget Control Act passed in August 2011 implied significant fiscal consolidation and Congress and the Administration have adhered to the automatic spending cuts – the sequester – specified under the Act in the absence of agreement on an alternative and equivalent set of deficit-reduction measures. In addition, the passage of the American Taxpayer Relief Act on 1 January 2013, which implied a tax increase of more than USD600bn, has also contributed to the deficit reduction effort. – Fitch’s medium-term fiscal projections imply federal and general government (which includes states and local governments) gross debt stabilising next year and over the remainder of the decade at around 72% and 104% of GDP, respectively. This is below the 80% and 110% thresholds that Fitch previously identified as being inconsistent with the U.S. retaining its ‘AAA’ status. – Nevertheless, public debt stabilisation at such elevated levels still render the US economy and public finances vulnerable to adverse shocks and in the absence of additional spending reform and revenue measures, deficits and debt will begin to rise again at the end of the decade. The U.S. is the most heavily indebted ‘AAA’ rated sovereign, with a gross debt ratio equivalent to double that of the ‘AAA’ median. RATING SENSITIVITIES The RWN reflects the following risk factors that may individually or collectively result in a downgrade of the ratings: – Failure by the government to honour interest and/or principal payments on the due date of U.S. Treasury securities would lead Fitch to downgrade the U.S. sovereign IDR to ‘Restricted Default’ (RD) until the default event was cured. We would also downgrade the rating of the affected issue(s) to ‘B+’ from ‘AAA’, the highest rating for securities in default in expectation of full or near-full recovery. Debt securities approaching maturity or those with approaching coupon payments would be vulnerable to a downgrade.