Why S&P didn't reconsider it's downgrade. "While the rate of the growth in debt slowed and was lower than first calculated, it never stopped growing and became sustainable, the criteria by which S&P had said last month it would judge the US. It had said it was looking for $4 trillion of cuts but the debt ceiling deal produced only about $2.7 trillion." - S&P 500 THIS IS WHY PEOPLE RESPECT S&P ON WALL STREET
If you don't understand that paragraph. They basically said, the cuts in spending. Were not enough to balance the US budget over time.
This might be the final straw for the Chinese and over the weekend they will say enough is enough and during the coming week, they will probably dump all their US Treasury Bonds!
Okay, when they said borrow cost will be higher due to this downgrade, for the lenders, are you saying they have to use S&P rating of AA as the new guide line? Or can these lenders use Fitch or Moody's AAA rating? by the way, I really like S&P's sense of humor, as if this week's news and event aren't enough, they throw this in on the 11th hour, just to top of a hell of a week.
all the CNBC commentators said if there is a downgrade (it's 4 pm EST, at the time, they don't know for sure), there won't be a reaction because every1 is expecting this
Those CNBC commentators are usually talking out of their asses. Why would they admit further weakness, just to have bigger fund outflows. There's no financial incentive to admit to a weaker market.