Tuesday, August 16, 2011

S&P Downgrade Proves Boon for US Treasuries

As I suspected the S&P downgrade had little to do with real economics and more to do with politics and retaliation for being hauled before Congress.  Though the Ratings agency lowered US Treasury ratings to AA+ from AAA, the market for those bonds is stronger than ever. 

Motivation becomes the real question for their downgrade, and I am still banking on the whole revenge aspect.  What is even stranger is their upgrade of China.  Read more at Bloomberg.

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