Phil Dow, director of equity strategy for RBC Wealth Management, says Standard & Poor's move to downgrade its outlook on U.S. debt is the first in a series of these actions that probably will come.
"These ratings agencies seldom act in isolation," says Dow, suggesting that Moody's and Fitch Ratings, the other big debt-raters, likely will join with their own negative outlooks in the weeks to come.
Dow thinks the downgrades are off the mark in this case, arguing that U.S. economic growth is now self-sustaining. Accordingly, he says that the end of QE2 this summer will be the last of the quantitative easing for the near term -- presumably obviating the need to downgrade the U.S. further. Pressure on the greenback has been a constant of late, as evidenced by the BRICS nations efforts to create a new global currency to allow the rest of the world to move away from the U.S. dollar.Read More »from More U.S. Downgrades to Come, but Stocks to Stay Strong