What's most ironic is that after the downgrade, price of treasury is up. There's NO substitute for the size of treasury. Other countries with AAA rating have total of only 10% of U.S. treasury. However, with the downgrade, some U.S. AAA corporate bonds have to be downgraded as corporate bond rating can't be higher than sovereign rating. So, fund managers, according to the set mandate, have to buy more treasury.
The US is down, but not out !!I am not sure if China, Russia and other BRICS countries can agree to create, on short order, a new global finance system to replace the one curretly dominated by the US.I also believe China is stuck in the Chinamerica relationship for as long as the US remains its major consumer of goods and services.