LIVE CHAT: What the Downgrade Means for Your Money

After falling for most of the past two weeks, stocks are set for another day in the red today after Standard & Poor's took the unprecedented move of downgrading the nation's credit rating on Friday.

It might not be over. S&P may downgrade states, local governments, and other public entities that implicitly rely on the federal government's purse this week. While these downgrades are widely expected, they could add to the general mood of disgust and disappointment that's been guiding markets lately.

There's never a good time to panic. And keep things in perspective: The Dow Jones is still up 9% over the past year! Stocks are down about 12% from recent highs. While gut-checking, that isn't an extreme correction by any means. It's almost an annual ritual. What's taken investors off guard is the speed at which the declines came, and -- importantly -- painful memories of the 2008 market crash, with fear we could be headed back down the same path (though that seems quite unlikely). Psychologists call this "recency bias."

Motley Fool columnists, analysts, and advisors are hosting a live chat starting now until approximately noon ET today, discussing what the downgrade means for your money. Please join the conversation below. Drop a question, answer someone else's, or just share your feelings and investment advice. We're expecting a large volume of comments, and we simply can't answer them all, so don't be discouraged if yours doesn't make it through.

At the time this article was published The Motley Fool has a disclosure policy.

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wstax

THE DEMOCRATS CAUSED THE HOUSING BURSTING BUBBLE-------------WATERS---PELOSI--REID---FWANK--
AT AL------------------INSISTED THAT EVERYONE SHOULD OWN A HOUSE, EVEN IF THEIR CREDIT WAS LOUSY AND THEY COULD NEVER SERVICE A MORTGAGE-------------------------------IT ALL STARTED THERE--------------THEN PEOPLE INVESTED IN MORTGAGE BACKED SECURIRIES AND LOST THEIR SHIRTS-----------------------THAT WAS NOT BUSH'S FAUL---IT WAS THE DUMB ASS LIBBIES----WHO NOW HIDE AND KEEP SAYING "TEA PARTY""
BALONEY!!!!!

August 08 2011 at 4:22 PM Report abuse -1 rate up rate down Reply
1 reply to wstax's comment
sevenv

Well then you should ,(BUT YOU WON'T), like this idea...Now not only will the republicans/tea party folks suffer BUT the those nasty LIBS will too...........Our triple A rating has been lost ,..so we propose a 10 to 20% pay and benifits CUT to congressional pay,and this cut will be tied to any future partisan "Gang Banging" ...that results in the kind of embarassment and trouble that this downgrade brings ....Surely you agree,that all of US in the lower realm of society,(voters who put them there ), must suffer then the upper crust,including those YOU favor should share in this tooo,right?? ....I mean those nasty DEMS did not get the legislation for the housing thing through alone,and you know that ,..Plus look at it this way ,...those who "Our" congress people really serve should/will make up the difference.....Right?..(HA YEAH RIGHT),.....The ONE difference between you and I ...,and there are a vast many of those ,...is I cannot stand any of them because I can see them for what they BOTH are,and rotting in hell is too good for them!!!

August 09 2011 at 5:59 AM Report abuse +1 rate up rate down Reply
wstax

I know a fellow named POGO who thought that buying Ford stock last week at $10.80 was a good move-----------------
I told him WRONG MOVE----------
His buddy, Barry liked his move-----------------------------bad judgment

August 08 2011 at 4:16 PM Report abuse +1 rate up rate down Reply
jjclb

EVERYONE SHOULD WATCH THE NEWS TONIGHT TO SEE WHO JUMPS OUT OF THE WINDOWS

August 08 2011 at 3:58 PM Report abuse +2 rate up rate down Reply
1 reply to jjclb's comment
wstax

Ah ain't jumpin out no windows cause ah gots my money in beer. I have a garage containing 800 cases of Bud Light---when beer prices shoot up--I will make my move

August 08 2011 at 4:17 PM Report abuse -1 rate up rate down Reply
jjclb

WE SOLD A LOT OF STUFF FROM OUR SCOTT TRADE AGENT THREE WEEKS AGO

August 08 2011 at 3:57 PM Report abuse -1 rate up rate down Reply
jjclb

I'M SO GLAD THAT WE HAVE OUR TWO MIL PLUS IN CASH IN OUR HOUSE AND OTHER CLOSE PLACES.

August 08 2011 at 3:56 PM Report abuse rate up rate down Reply
1 reply to jjclb's comment
wstax

We have had about 18 million in cash in small bills at our guest house in Paris. It requires a lot of space------------will you volunteer to "baby sit" our cash? Will pay you $5,000 a week to keep it safe.

August 08 2011 at 4:09 PM Report abuse +1 rate up rate down Reply
wstax

I keep reading about Bush------------30 years from now I can just hear President Goofoff blaming Bush for all his faults
and bad judgement-------the Democrats caused the housing mess that triggered all the agony in the economy---
Pelosi. Reid, Waters, Bwarney Fwank, Ted Kennedy-----et al

August 08 2011 at 2:11 PM Report abuse rate up rate down Reply
wstax

When there appears to be a panic-------------you pick out solid companies----ones with a long track record---------and you buy their stock or you add to what you now own----------I , personally, prefer good dividend stocks because of my age--------------if you are young, invest in long term growth. Do not put all your investments in an IRA---------you will regret it later on---------if you are in your 70"s, invest in dividend income stocks-----------too old for growth-------and whatch out for brokers. Also watch out for banks who want to sell you an Annuity

August 08 2011 at 2:08 PM Report abuse -1 rate up rate down Reply
cmuen486

bush,bush,bush! why can't we remember how he put America in this spot and then gave it to a new president! In addition, he did not know just how bad it was until in office due to top-secret knowledge. The republicans went for it and now we are all going to pay for his decider ailttude.now we have a tea party that it is Mr.Obama's fault, my mom said the sixty's are back but only in burn out ideas (dig it)
Remark is what good schooling provides

Very confused

August 08 2011 at 1:59 PM Report abuse +2 rate up rate down Reply
3 replies to cmuen486's comment
Dee

I agree with Bonnie take care of us for a change

August 08 2011 at 1:54 PM Report abuse rate up rate down Reply
1 reply to Dee's comment
wstax

Dee---take care of yourself------------best advice-------------don't look to government to make your life better

August 08 2011 at 2:12 PM Report abuse rate up rate down Reply
Mordy

We need a new President of the USA and a new Congress. Greed and the peter principle have taken over in Washington.

August 08 2011 at 1:42 PM Report abuse rate up rate down Reply
1 reply to Mordy's comment
wstax

always been there

August 08 2011 at 3:21 PM Report abuse rate up rate down Reply