The United States just got downgraded. Should we care?

financialpost.com:

The unexpected downgrade of U.S. government debt sent shockwaves across the economic and political landscapes. In financial markets, the move was met with what amounts to a shrug.

The last time this happened in 2011, S&P’s downgrade of the U.S. credit rating triggered a selloff in risk assets like equities around the world, but ironically boosted Treasuries as investors sought out havens.

This time, U.S. stock futures fell as much as 1 per cent overnight before cutting that decline in half as of 7:30 a.m. in New York — a minuscule move for contracts on the S&P 500, an index that’s rallied for five straight months. Reaction was also muted in the Treasury and foreign-exchange markets, with the 10-year yield sliding and the dollar little changed versus major peers.

The general consensus among strategists and fund managers has been that the rating cut should have a limited impact on equities, with Wells Fargo & Co. saying any pullback will be “short and shallow” and Liberum Capital describing the news as a “tempest in a teapot.”

For some, it’s a good excuse to book some profits after a 19 per cent jump this year in the S&P 500. The index hasn’t had a down day of 1 per cent or more in 47 straight sessions, the longest such streak of calm days since January 2020.

Here’s what analysts and strategists had to say:

“One can have the feeling that the market is looking for excuses to take some profits. But rather than the Fitch downgrade, I suspect that what’s currently being priced is the growing risk of an economic slowdown. The downward trend started to emerge yesterday on the back of disappointing Chinese and U.S. data, which suggests it’s not really about the rating downgrade but rather the risk of a slowdown.”

“Today’s market