The $1 Billion Armageddon Trade Placed Against the US Bond Market

http://www.marketoracle.co.uk/Article29477.html

QUOTE: "This means someone is confident that the United States is either going to default or is going to lose its AAA rating. That someone is willing to bet the proverbial farm that U.S. interest rates will be going up.I believe what happened is a debt-ceiling deal was done in Washington and leaked to a major proprietary trader. Everyone knows the debt negotiations in Washington have been an extreme game of brinksmanship between political parties, but now someone knows how that game played out. This had the hallmarks of one of the largest bond shops in the world knowing something the rest of the market didn't. The number of shops or even central banks that can take on this level of market risk is extremely small. Some that come to mind are hedge fund manager John Paulson, Bill Gross's PIMCO, and the U.S. and Chinese central banks.Paulson already scored big - about $6 billion big - on a similar trade years ago when he bet against subprime mortgages, the investments that helped bring down Lehman Bros. and many other investors. Whoever was behind it wanted a trade on ASAP, and didn't care about the ripples they would cause."

So let's assume the author of this article has figured out something important that the rest of the media is missing/ignoring.  What does that mean for you and me?  It appears that one way or another the US will likely loose its AAA credit rating and thus the interest on the debt is going to be taking up even more of the nation's budget.  In addition, it looks like it's very possible there could be a default.  And what will happen if the US defaults?  From what I can tell poking around on Google, it appears a lot of people are asking that very question. (NOTE: Despite his hyperventilating to the media and those on the left, the President is telling his bank buddies that we won't default.  So what is this whole 'crisis' about then?)