| Kasz216 said: Which makes sense, though I feel won't effect much. Rally it seems more and more like credit agencies are following the market.... not the other way around. Heck, look at the US downgrade. That happened. Since then, US bonds are in higher demand then ever. Higher then a lot of the Triple A countries bonds. Looking at it through that metric you'd think it was crazy the US had that kind of rating. |
Wouldn't that be because a credit downgrade makes you higher risk, which in turn forces up the interest rates on your bonds, thus making them more attractive and allowing you to find more foreign financing? Which in turn allows you to run further expansionary fiscal policy, helping to push your home market forward and appreciate your currency.
So long as there is no real danger of default, one would almost think a little downgrade would be a welcome thing. The benefits more than make up for the bad publicity.
Monster Hunter: pissing me off since 2010.
