NEW YORK ( TheStreet) -- Weiss Ratings on Friday downgraded its rating for United States sovereign debt to a "C-minus," or just one notch above a junk rating. Weiss had initiated its sovereign debt ratings in April, with an investment-grade rating for the U.S. of "C," saying at that time that low rankings in the categories of debt burden, international stability and economic health, were partially offset by the nation's "ability to borrow in the global marketplace."
Weiss Ratings president Martin D. Weiss
The new "C-minus" rating translates roughly to investment-grade ratings of "BBB-" at Standard & Poor's and "Baa3" at Moody's, both of which are one notch above junk status. The looming debt ceiling deadline in Congress and tortuous negotiations with President Obama, "not to mention the complete lack of any plan to address the nation's obscene debt levels," led to the rating action, according to Weiss Ratings senior financial analyst Gavin Magor. "Weiss Ratings made it clear that the only reason that the US was rated as high as a 'C,' two notches above junk, was that it had the complete confidence of the markets. This is no longer the case. Even Moody's has warned the US this week that it may consider a downgrade," Magor told TheStreet. Speaking of the debt ceiling debate, Magor said "the U.S. has debt and deficit problems whether or not the debt ceiling is raised. The excessive borrowing levels must be addressed urgently and until then the US cannot justify a 'AAA' rating from the Standard & Poor's , or frankly, anything close to that." Weiss Ratings is an independent ratings service, specializing in rating the financial strength of insurance companies, banks, thrifts and credit unions, in addition to the sovereing debt ratings. -- Written by Philip van Doorn in Jupiter, Fla. To contact the writer, click here: Philip van Doorn. To follow the writer on Twitter, go to http://twitter.com/PhilipvanDoorn. To submit a news tip, send an email to: email@example.com.