Perhaps you recall back in August of 2011 when S&P’s credit rating agency downgraded US debt…no?? Well, if not, you weren’t alone. Markets shook it off, maybe because a) it didn’t make a lick of sense at the time, b) the credit raters hadn’t exactly distinguished themselves during the debt bubble.
Well today they revised their outlook from “negative” to “stable.” And again, I expect no one to notice.
In fact, here’s the trajectory of 10-year Treasury yields since the downgrade, wherein you see a conspicuous lack of reaction to the downgrade. I often poke at financial markets for not being as all-knowing as assumed, but in this case, I gotta give it up: they correctly ignored non-information.