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US downgrade and side effects

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posted on Aug, 6 2011 @ 08:01 AM
I was looking that the CME has a 0% margin requirement us bonds. Will the credit downgrade force them to move up the margin requirements?
Canada, France , And germany all havee AAA credit and they have a 5% requirement. With this new down grade will they be forced to raise the margin to at least the level of the countries with a better credit rating?
If so will this cause a mass selloff of US Bonds?

posted on Aug, 6 2011 @ 08:47 AM
reply to post by jlafleur02

Watch the markets. If you see Europe tanking on Sunday, it'll be a horror show on Wall St. on Monday.

I have buddies that think that the S&P are going to re-evaluate, but the damage has been done already. And Moody's is rethinking their position as well.

It'll get worse before it gets better. I believe that we will not recognize our form of goverment within the next eight years. I hope it will be a better Goverment with a fair or flat tax, but I have my doubts.

But until we get manufacturing back in the US at a fair wage (That doesn't mean union wages folk), it is not going to get any better.

posted on Aug, 6 2011 @ 09:12 AM
China has already started dumping its short term US bonds over the past few weeks. They still have about a trillion in long term bonds along with Japan having a slightly smaller amount. They are sounding feed up with the US situation and are providing strong warnings that the tide is turning in looking for a new global reserve.

posted on Aug, 6 2011 @ 09:13 AM
Saw a few posts the other week on the end of the dollar as the world reserve currency.

Then this?

Maybe they were right.

posted on Aug, 6 2011 @ 09:19 AM
Credit Rating Agencies are nothing more than crystal ball gazers that based their ass umptions linearly on what happens today.

But we all know, and even now alan greenspan, that human evolution and progress is never linear and predictable by ANY mortal.

All we know is that humankind has the ability to correct mistakes, adapt and persever. Thus, credit ratings are never worth the paper their ink is set upon, and are considered junk by those whom have common sense and rationality to see the bigger picture. Only fools and the easily duped middle classes to foolishly depend on it to invest their pathetic savings grow.

Opportunities, like the tides, wait for no man. more so the foolish ones.

posted on Aug, 6 2011 @ 10:09 AM
Credit ratings by country
Countries with AA Ratngs:
United States
Abu Dhabi
New Zealand
Saudi Arabia

Countries with AAA Ratngs:
Hong Kong
Isle of Man
United Kingdom

posted on Aug, 6 2011 @ 10:15 AM
The dollar will fall in value; gold and Swiss franc will go up

posted on Aug, 6 2011 @ 01:39 PM
reply to post by Surfrat

That's GOOD NEWS!. With the drop in dollar, it would mean:-
a. higher chances for US exports to be exported to overseas market meaning more revenue to the treasury.
b. lower demand for imported goods, more so with fake and poor quality China junks.
c. higher wages to beat inflation once US goods in demand, provided bosses learn their lesson and willing to share profits.

WIth the rise in gold, USA should be smiling ear to ear. They as an entity, are holding the largest amount of gold beside private collectors, meaning its gold deposits sitting in vaults of treasury are book valued more bring health to the nation's economy. Let's hope it is real gold, and not those discovered in China's hongkong province diluted.

edit on 6-8-2011 by SeekerofTruth101 because: (no reason given)

posted on Aug, 6 2011 @ 06:09 PM

Peter Schiff has a great video up discussing the ramifications of this downgrade. He states that not only will the US federal bonds have to have higher interest rates, but so will state and local municipal bonds. He feels this is because they are all doled out in the same currency, which just received a vote of no confidence. He also states this same phenomena will have a negative effect on stocks of American companies as all there business is also done in US dollars.

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