On another note- John Carney writes in the same article:
It’s very likely that a downgrade of the credit rating of the U.S. would trigger a sell-off, but it’s far from clear that investors would sell U.S. government debt. More likely the investors would sell risk assets—equities, high yield corporate bonds, mortgage securities—and actually buy U.S. government debt.It just doesn't make much sense to say that a downgrade by a ratings agency will cause people to buy more not less of that security. Every single downgrade in the Eurozone has caused a sell-off, why should it be different here?
Keep Dancin'
Steven J.
A major is coming.
ReplyDelete