The once-unthinkable loss of the AAA rating will constitute a further hit to already fragile business and consumer confidence.

We normally think if you're going to lend someone money, you should get some reward for doing this. In Europe, it's a tax!

The one instrument that has relative political autonomy is monetary policy. Central banks do not need to go to Congress to get approval for an interest rate hike.

It is hard to imagine that, having downgraded the US, S & P will not follow suit on at least one of the other members of the dwindling club of sovereign AAAs. If this were to materialise and involve a country like France, for example, it could complicate the already fragile efforts by Europe to rescue countries in its periphery.

The once-unthinkable loss of the AAA rating will constitute a further hit to already fragile business and consumer confidence.

Investors should be cautiously positioned as the global economy and markets face major uncertainties. The downgrade will be a further headwind to growth and job creation in the U.S.

The world changes! So we're in a situation today where the only policymakers that have flexibility are central banks. But they don't have the instruments! So they've had to experiment, and the more you experiment, the more uncertainty and the higher the risk of collateral damage.