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RED ALERT: In Unprecedented Move, Moody’s Downgrades U.S. Credit Rating From AAA to AA1!
Even if you’re not into finance, you probably know the name Moody’s, one of the most established credit rating agencies alongside the S&P and Fitch.
And until this very day, May 16, 2025, Moody’s has NEVER rated U.S. Credit lower than a AAA rating.
Today that all changed, as Moody’s dropped the U.S. rating to AA1 for the first time ever.
NEW: Moody’s downgrades U.S. credit rating from Aaa to Aa1, citing the budgetary burden the government faces amid high interest rates. https://t.co/pdYbLi0laL
— NBC News (@NBCNews) May 16, 2025
While unprecedented for Moody’s, it was actually not unprecedented for the other agencies, as they had cut the rating earlier:
Historical Context of Moody’s Ratings for the U.S.
Moody’s Aaa Rating Until 2025:Prior to this event, Moody’s had consistently maintained the U.S. at its top Aaa rating for over a century. According to the web results from moodys.com, Moody’s has been assigning sovereign credit ratings for over 100 years, and the U.S. had held the Aaa rating throughout that period until this downgrade. Even when Moody’s shifted its outlook on the U.S. to “negative” in November 2023 (as noted in the pgpf.org web result), it still reaffirmed the Aaa rating at that time.
No Previous Downgrades by Moody’s:Unlike the other major credit rating agencies—Standard & Poor’s (S&P) and Fitch—Moody’s had not previously downgraded the U.S. below Aaa. S&P downgraded the U.S. from AAA to AA+ in 2011, and Fitch followed suit in August 2023, also moving from AAA to AA+. However, Moody’s had held firm with its Aaa rating until this point in 2025. The web result from pgpf.org explicitly states that while S&P and Fitch had already downgraded the U.S., Moody’s had maintained the top rating until the negative outlook in 2023 signaled a potential future downgrade, which has now occurred.
Why This Downgrade Matters
The 2025 downgrade to Aa1 is significant because it ends Moody’s long-standing tradition of rating the U.S. at Aaa, a rating that symbolized the country’s unparalleled creditworthiness. Moody’s cited the rising debt and interest payments, which are now “significantly higher than similarly rated sovereigns,” as the primary reasons for the downgrade (per the Reuters web result). This aligns with broader fiscal concerns: the U.S. debt is projected to exceed 160% of GDP by mid-century, and interest payments are increasingly crowding out other budgetary priorities, as noted in earlier analyses like those from the Congressional Budget Office and Econofact.
Any way you slice it folks, this is bad.
REALLY bad.
President Trump inherited a complete mess, and it looks more and more likely every day that he will need to do his version of a “Great Reset” to save this thing. Reforming the system simply may not be possible at this point.
In other words….
Got Bitcoin?
Got XRP?
Got Gold and Silver?
I do!
CNBC had more details on the massive move:
Moody’s Ratings cut the United States’ sovereign credit rating down a notch to Aa1 from the Aaa, the highest possible, citing the growing burden of financing the federal government’s budget deficit and the rising cost of rolling over existing debt amid high interest rates.
“This one-notch downgrade on our 21-notch rating scale reflects the increase over more than a decade in government debt and interest payment ratios to levels that are significantly higher than similarly rated sovereigns,” the ratings agency said in a statement.
The decision to lower the United States credit profile would be expected, at the margin, to lift the yield that investors demand in order to buy U.S. Treasury debt to reflect more risk, and could dampen sentiment toward owning U.S. assets, including stocks. That said, all the major credit rating agencies continue to give the United States their second-highest available rating.
The yield on the benchmark 10-year Treasury note
climbed 3 basis points in after-hours trading, trading at 4.48%. The iShares 20+ Year Treasury Bond ETF
fell about 1% in extended trading, while the SPDR S&P 500 ETF Trust
fell 0.4%.
Moody’s had been a holdout in keeping U.S. sovereign debt at the highest credit rating possible, and brings the 116-year-old agency into line with its rivals. Standard & Poor’s downgraded the U.S. to AA+ from AAA in August 2011, and Fitch Ratings also cut the U.S. rating to AA+ from AAA, in August 2023.
“Successive U.S. administrations and Congress have failed to agree on measures to reverse the trend of large annual fiscal deficits and growing interest costs,” Moody’s analysts said in a statement. “We do not believe that material multi-year reductions in mandatory spending and deficits will result from current fiscal proposals under consideration.”
Moody’s follows on the heels of Morgan Stanley:
Morgan Stanley DOWNGRADES U.S. Dollar Rating — Bad Times Ahead?
Not only that, but recently Moody's downgraded U.S. Banks as well.
Do you remember this?
Moody’s DOWNGRADES Top U.S. Banks—Is YOUR Bank On The List?
Look, I can't tell you what to do, I'm not a financial advisor.
But me personally?
I have a big chunk of my assets in crypto and another big chunk in precious metals.
I keep as little as possible in the banks.
That's just what helps me sleep best at night.
Here's more on gold:
Here's Why Central Banks Are Buying All the Gold They Can -- And What YOU Can Do!
For the last year, central banks across the globe have been buying up as much gold (and often silver) as they can acquire without raising alarm bells. Now, we see why.
The recent bank runs and ongoing collapse of the U.S. banking system was anticipated by the "elites" and the central bankers who run things behind the scenes. They saw it coming and knew the best way to protect their assets was through physical precious metals.
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Precious metals.
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Central bankers aren't slowing down. In fact, nations like China and even U.S. states like Tennessee are quickly but quietly buying up gold to back their own treasuries. When the writing on the wall is this clear, it's understandable why these governments are moving quickly to get ahead of any potential economic catastrophes in store.
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Don't wait too long, we might have more bank failures right around the corner.
You know what has NEVER "failed"?
Gold. Precious metals. Indestructible.
There's a reason they call it "God's money".
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