So S&P downgraded the credit rating of the US from AAA to AA+. What are the implications? I think, nothing. Rating agencies such as S&P might be applicable for companies and even governments but when you’re talking the US it’s different. Japan and China, with their huge holdings of US debt won’t really base their own rating and pricing from some rating agency. And in self interest, they certainly won’t simply let their holdings lose value which would be the case if yields rise due to the ratings downgrade. These large holders are the rating agencies when it comes to the US. Already Japan has indicated that their confidence is unchanged and China with it’s bigger holdings is likely of the same mind.