Governor Malloy and Senator Blumenthal Respond to Credit Downgrade (Videos)

Gov. Dannel P. Malloy said Monday during a tour in Milford that he believes the country is heading toward a double-dip recession.

"I think, based on Republican policy making in the Congress, it is increasingly a possibility," Malloy said. He also noted the economic difficulties in Italy, Spain, Portugal, Ireland and Greece.

"There's a lot of pressure out in the system," Malloy said. "That's why U.S. Treasury bonds have not risen in price," he added. But Malloy believes treasuries remain strong investments.

"People are looking at what's happening in Europe and saying, 'For long-term investment purposes, we'll have (U.S.) treasuries in our portfolio,' " Malloy said.

U.S. Sen. Richard Blumenthal (D-CT) speaking in Naugatuck on Monday said he takes seriously the country's credit rating. 

But, Blumenthal said Standard & Poor’s credit downgrade of the U.S. Treasury bonds from an AAA to AA+ has more to do with the credibility of the credit rating agency. 

“The downgrade of U.S. Treasury bonds by one of the rating agencies, S&P, certainly undermines and adds greater doubt about the credibility and integrity of that rating agency, and maybe some of the others,” Blumenthal said.

Blumenthal noted the agency also gave AAA ratings to bonds that were backed by mortgages that eventually became worthless."