Obama is the first President ever to have a credit rating downgrade on his watch

[droski]

From what I have read, that's easily the largest negative of this.

I beieve the number I saw was the increase of interest would be akin to $65 a year on a $200K mortgage.

Hard to predict because we're talking about many billions of forced selling, but short term at least I don't see a major increase.
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[volinbham]

Heard that bank regulators said US Treasuries will still count for capital requirements. What entities will be forced to sell to maintain reserves in AAA?

 

[MY3*VOLS]

NYT: China tells US to 'cure its addiction to debt' - Business - US business - The New York Times - msnbc.com

 

[droski]

Heard that bank regulators said US Treasuries will still count for capital requirements. What entities will be forced to sell to maintain reserves in AAA?

Many foundations, endowments, lots of trusts, and even some pension funds have it in their charter that they can only hold AAA debt. Usually we are talking about ones created decades ago, but many still exist. Not sure how the other rating agencies still having it at AAA effects that though.
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[golfballs]

I've heard there really aren't that many that have those kind if requirements, so the impact won't be as big as some think
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[lawgator1]

From what I have read, that's easily the largest negative of this.

I beieve the number I saw was the increase of interest would be akin to $65 a year on a $200K mortgage.

That's manageable.

I wouldn't mind if this caused the panel to look at getting to $3 trillion in debt reduction from here
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[NEO]

Many foundations, endowments, lots of trusts, and even some pension funds have it in their charter that they can only hold AAA debt. Usually we are talking about ones created decades ago, but many still exist. Not sure how the other rating agencies still having it at AAA effects that though.
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I know of many trust funds that still have that requirement that were created in the last decade.

 

[NEO]

I've heard there really aren't that many that have those kind if requirements, so the impact won't be as big as some think
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I'm not to sure of that. I honestly don't know the actual numbers but do know that even in the last decade many advisors where stating it should be aaa rated if you want to make sure the trust is on solid ground.

Whole purpose of a trust is to make sure the money is air tight protected in all apsects. Kinda killing the point if you are allowing non aaa rated debt into the portfolio.

 

[IBlvNTmWrk]

[youtube]http://www.youtube.com/watch?v=VtVbUmcQSuk[/youtube]