Monday, August 1, 2011 10:23 – Market Drops Despite Debt Deal

The expected rally on news of the leaders agreeing on a budget deal lasted 4 minutes. In the first four minutes of trading the market was up 1.25% but that was the top so far.

The S&P 500 is now down -0.4%.

Worries: (1) Is the deal is strong enough to pass the House? (2) Is the deal enough to avoid a credit downgrade of US debt? (3) Is the slowing economy going to put us back in recession?

We’ll know the answer to the 1st today, the second in the next few weeks and the third late in 2011.