Bonds and Equities: Upstairs, Downstairs
Both treasury and equity markets reacted to the debt downgrade as expected Monday, with bonds spiking and equities basically imploding
Both treasury and equity markets reacted to the debt downgrade as expected Monday, with bonds spiking and equities basically imploding
After an initial sense of relief when the debt deal started coming together Monday morning, markets have slumped back in their figurative armchair to watch a series of economic debacles unfold like bad TV
Traders are playing musical chairs these days, and not always willingly. A grim economy, wavering trading profits and looming regulatory changes are breaking up big trading operations and battering bottom lines.
The debt crisis in Europe is like a high stakes game of musical chairs – which nation will be the next to default when the music stops?
Moody’s Investors Service put several large U.S. banks on notice Thursday that their debt ratings are being reviewed for a potential downgrade. But it was just the tip of the old iceberg for grim reports from the ratings agency.
Ratings firm Standard & Poor’s made some waves on Monday by downgrading its outlook for U.S. Treasury debt. Short of actually changing the rating on U.S. debt, they lowered their outlook from “stable” to “negative.”
Investors have been getting fleeced in all sorts of bond schemes lately, according to actions in a variety of federal courts. And the victims have ranged beyond the typical, unfortunate retail customer.
A lot of people, including some prominent politicians, are wondering if it would be a good idea to create federal laws allowing states to declare bankruptcy – and then renegotiate pesky contracts with assorted riff-raff like bond holders, unions, and pensioners.
Yes, the world’s tenth-largest economy, according to Euromonitor International, has been lumped in with the likes of Portugal, Ireland and Greece as Eurozone problem children. But there is more to Italy than meets the eye, and that can be good news or bad news depending on which scenario plays out.
“Tragedy comes in threes,” Senate candidate Christine O’Donnell told Tea Partiers, according to an account from CBS News.
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