S&P 500 Breaks Below 1300

Ugly day today. Standard & Poor’s put a “negative” outlook on America’s debt rating.

“We believe there is a material risk that U.S. policy makers might not reach an agreement on how to address medium-and long-term budgetary challenges by 2013,” New York-based S&P said in a report today. “If an agreement is not reached and meaningful implementation does not begin by then, this would in our view render the U.S. fiscal profile meaningfully weaker than that of peer ‘AAA’ sovereigns.”

I really don’t understand a debt rating for the U.S. Treasury bonds. America’s debt is “rated” every day in that it’s priced by traders.

Sure, the long-term numbers look awful but the reality is that investors keep buying our debt, and they’re willing to give us a good deal.

The S&P 500 is again below its 50-DMA.

Posted by on April 18th, 2011 at 10:03 am


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