Foreign holdings of US debt hit $5.46 trillion

Associated Press Modified: November 16, 2012 at 12:00 pm •  Published: November 16, 2012
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After the last debt standoff in the summer of 2011, Standard & Poor's downgraded the government's credit rating on long-term securities one notch from the highest level of AAA to AA+. It was the first ever downgrade of U.S. government debt.

Last week after the presidential election, Fitch Ratings said Obama will need to quickly come to a budget agreement with Congress over the so-called fiscal cliff or risk losing the AAA rating Fitch has on U.S. debt.

The fiscal cliff refers to the collection of tax increases and spending cuts scheduled to take effect in January unless a deal is reached. Economists have warned that the U.S. economy will be pushed into a recession next year if the fiscal cliff is not averted.

Obama met at the White House on Friday with congressional leaders as negotiations over the fiscal cliff began in earnest. Obama said "tough compromises" would need to be taken.