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- BBC News

What significance does the credit rating actually have? Will there really be any countries that are like "NO MONEY 4 JOO YOUR CREDIT IS BAD!"?

It will likely cause problems in the market in the short term.

I don't pretend to know why (been a while since Macro Econ) but I'm assuming that's what will happen.

It's interesting that I've seen that title or a variation on it everywhere, given that lots of people will only ever read the title. The drop (as they say in the article) is from AAA to AA+, which wikipedia describes as "extremely strong" vs "very strong". A degree of change so small that the descriptive words differ only in connotation. Marketwise, this is definately not good but it doesn't mean they think that the government is on the verge of collapse.

I have heard people point out that this could be a political ploy by S&P given that they can pretty much say whatever they want and there are AAA bonds that are arguably riskier than the US.

Likely the US Dollar will deteriorate even further, and drag the equity markets down with it (temporarily at least, as the USD and stocks have an inverse relationship which does get violated from time to time).

Gold will no doubt benefit the most and continue in its meteoric rise.

AIG was rated tripple A days before the economy broke

Originally posted by inimalist
AIG was rated tripple A days before the economy broke

nuts
WERE ALL GONNA DIE!!!
GOTTA BUY GOLD FROM GLENN BECK
nuts

It doesn't seem like it matters too much, but I do think it reflects a legitimate assessment of the American economy after that fiasco about the debt ceiling

Originally posted by Lord S
Likely the US Dollar will deteriorate even further, and drag the equity markets down with it (temporarily at least, as the USD and stocks have an inverse relationship which does get violated from time to time).

Gold will no doubt benefit the most and continue in its meteoric rise.


Pretty much.

This may not be a big drop at all, but the Chinese are not amused and they are proposing (at least here) to to have a new, more stable world currency, instead of a dollar.

Obviously, China wants to secure the safety of its dollar assets and thus are concerned.
Since the official news are talking about it, I have no doubt that introduction of a new world currency may actually happen.

This downgrade IS actually a big deal as it will raise borrowing costs for US government and US companies...and possibly consumers too.

Well we have a few more hours till the NYSE opens and looks like everyone in Asia is down right now, wonder how far down the Dow will fall today?? Prob not going to be good. Gold is now $1,715. I think Tim G should be gone, he should have been gone a long time ago!!!

I fear the result of investing too much into gold. Meaning, what if it drops super duper much falling far below the level of when I first invested?


That's really just the name of the game but I fear it more in gold than other investments.

The US credit rating and all these finance markets can go to zero for all I care.

^Agreed.