Usa Downgrading & Eu Bonds Increasing Again- Anyone Planning For This?

[ExpatJ]

After reviewing the news and watching CNBC, Bloomberg (btw- both channels have surprisingly high number of slutty looking Asian lady newscasters) it looks like the US is going to lose its AAA rating. Spanish, Italian and Greek bonds are also increasing again sharply so it looks like the EU bailout last week did not work....

Anyone making any investment plans for this?

I have cashed out about 50 % of my stocks and increased my gold investments.

[aussiebebe]

Those anchors are attractive (esp Bloomberg) but don't base your investment decisions on their trash-talk. Asia holds around $3 trillion in US government debt and if China isn't worried about the US failing to find a solution, neither should anyone else be. The US problem is simply political and buying gold at it's present record price is as risky as buying tech stocks was back in '99. You've got to reconsider gold as a hedge against financial crisis when you look at how gold plummeted after Lehman's collapse.

[terryp]

Those anchors are attractive (esp Bloomberg) but don't base your investment decisions on their trash-talk. Asia holds around $3 trillion in US government debt and if China isn't worried about the US failing to find a solution, neither should anyone else be. The US problem is simply political and buying gold at it's present record price is as risky as buying tech stocks was back in '99. You've got to reconsider gold as a hedge against financial crisis when you look at how gold plummeted after Lehman's collapse.

:cheesy: :cheesy: Sorry dont agree, bet you were saying gold was just a hedge at $250.

China is not worried? of course not; it needs American trade to keep it;s factory's running and people quiet, China could not even care about the treasury's its all priced into their system

There will be massive market manipulations in the next week so great care is required

[CaptHaddock]

The debt limit "crisis" in the US is a phony crisis. The US will raise the debt limit and pay its bills. Effects on the dollar and Treasury bond rates will therefore be temporary. In the long run, the dollar will continue to decline because of the trade deficit, although there will be periods of time when it recovers, such as next year if a recession emerges. The loss of the AAA rating will probably not matter very much. Japan lost its AAA rating in about 2001 without a noticeable effect on its interest rates. These are the same rating agencies, after all, that gave AAA ratings to the CDO crap that caused the banking crisis in 2008.

The Euro however is in a genuine crisis. At least some of the peripheral countries, such as Greece, will likely leave the euro because the Germans will be unwilling to pay their liabilities in the end. Then the euro union could conceivably collapse. Italy seems to be the one to watch.