by Jerry Robinson | FTMDaily Editor-in-Chief
FORT WORTH, August 7
While I am on the road this weekend, I am keeping a close eye on the unfolding drama in the global economy. After the S&P's decision to downgrade America's credit rating, things are certain to get interesting this week.
Here's a round-up of some of the news that I have seen this evening while sorting through the headlines…
- We begin in China where the head of one of the country's top credit rating agencies has said that the U.S. dollar is going to be discarded by the globe. Meanwhile, China's official state-run media outlet, the Xinhua news agency, warned that "the U.S. government has to come to terms with the painful fact that the good old days when it could just borrow its way out of messes of its own making are finally gone."
- A Standard & Poor's official says there is a 1 in 3 chance that the U.S. credit rating could be downgraded another notch if conditions erode over the next six to 24 months.
- Former Federal Reserve Chairman, Alan Greenspan, appeared on NBC's Meet the Press on Sunday morning and argued that the United States can pay any debt it has "because we can always print money to do that." Therefore, there "is zero probability of default." This language is highly indicative of more inflationary policies ahead. No surprise.
- In Asia on Monday, during early morning trading, U.S. stock futures were sharply lower. Gold prices were up over 2%. When the markets opened in Israel on Sunday, the Tel Aviv stock market fell over 7% on the news of the U.S. downgrade.
- On Sunday, in Europe, the ECB held an emergency meeting and announced that they “will actively implement” their bond-buying program to assuage investor fears that the euro-zone debt crisis may engulf big economies such as Italy and Spain.
- So, with the U.S. out of the "AAA" credit rating club, who's left? Quite a few countries remain… Here's the list.