The S&P downgrade

posted by
August 9, 2011
by Paul Craig Roberts  
Posted in Commentary

"The reduction in the government’s credit rating to AA+ from AAA is a cosmetic change. It remains a very high investment grade rating and is unlikely to have any effect on interest rates. It is revealing that despite the downgrade, US bond prices rose. It was stocks that fell. The financial press is blaming the stock market decline on the bond downgrade. However, stocks are falling because the economy is falling." (08/09/11)  

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