The massive downgrade would threaten a broad swath of the world’s finance industry, S&P said, ranging from Wall Street’s trading desks to regional banks to local credit unions. … The 238-page list of bonds considered for downgrade includes transactions involving virtually all the major investment banks, including Citigroup Inc., Lehman Brothers Holdings Inc., Bear Stearns Cos., and Merrill Lynch & Co. The bonds considered for downgrade represent nearly half the bonds of that kind sold between January 2006 and June 2007, S&P said. As we’ve said, this is a matter of “when”, not “if”. And looks like “when” is “now”.

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