Well these investors should try crossing their fingers as well and keep a rabbit's foot under their pillow.Because if the US stiffs its creditors, the impact will incur steep stringent losses.A default will cause turmoil on Wall Street and a repeat of the 2008 financial crisis.In such cases, a sure thing becomes a sure failure.
A default could finish off the US economy completely and when the economy turns grim traders turn to Treasuries.They serve as a back-up haven hence the high investor demand.There may be nowhere to hide,but one failsafe method is to buy "puts" - shares that track two stock indexes.So if the US defaults and stocks tumble, investors can buy low, sell on at a higher locked-in price and pocket the difference.
A default could finish off the US economy completely and when the economy turns grim traders turn to Treasuries.They serve as a back-up haven hence the high investor demand.There may be nowhere to hide,but one failsafe method is to buy "puts" - shares that track two stock indexes.So if the US defaults and stocks tumble, investors can buy low, sell on at a higher locked-in price and pocket the difference.
