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New Jersey Downgrade; What It Means for Investors?

Poor New Jersey. It’s struggles with an unfavorable image, it’s been the butt of countless jokes and now this.

On Wednesday Standard & Poor’s cut New Jersey's bond rating one notch to AA-, citing the state's unfunded pension shortfall and high debt.

According to the Wall Street Journal, about 8% of states are rated "AA-" like New Jersey while thirty-eight percent are rated "AA" by Standard & Poor's. "AAA" is the highest rating.

California and Illinois are the lowest-rated states by Standard & Poor's. California carries an "A-" with a negative outlook, while Illinois carries an "A+" with a negative outlook.

What should you make of the downgrade? Find out from famed bond investor Alexandra Lebenthal. Watch the video now!


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Trader disclosure: On Feb 9, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Jon Najarian owns (CSCO) call spreads; Jon Najarian owns (WFMI) calls; Jon Najarian owns (ECA); Jon Najarian owns (JNPR), is short (JNPR) calls; Jon Najarian owns (GS), is short (GS) calls; Jon Najarian owns (IBM), is short (IBM) calls; Jon Najarian owns (AET), is short (AET) calls; Jon Najarian owns (RIMM), is short (RIMM) calls; Jon Najarian owns (AAPL), is short (AAPL) calls; Jon Najarian owns (X), is short (X) calls; Jon Najarian owns (SWY), is short (SWY) calls; Jon Najarian owns (RSH), is short (RSH) calls; Jon Najarian owns (M), is short (M) calls; Terranova owns (VRTS); Terranova owns (C); Terranova owns (UPL); Terranova owns (GM); Terranova owns (PEP); Terranova owns (LTD); Terranova owns (CVI); Terranova owns (SU); Terranova owns (CNQ); Terranova owns (POT) puts; Adami Owns (AGU); Adami Owns (C); Adami Owns (GS); Adami Owns (INTC); Adami Owns (MSFT); Adami Owns (NUE); Adami Owns (BTU); Adami's wife works for (MRK); Finerman's firm is short (MDY); Finerman's firm is short (SPY); Finerman's firm is short (IWM); Finerman's firm is short (IJR); Finerman's firm is long S&P puts; Finerman's firm is long Russell 2000 puts; Finerman owns (AAPL); Finerman's firm owns (AAPL); Finerman's firm owns (AVP) calls; Finerman owns (BAC); Finerman's firm owns (BAC) leaps; Finerman's firm owns (BBY); Finerman owns (C); Finerman's firm owns (FCX) puts; Finerman's firm owns (GLW); Finerman owns (GOOG); Finerman owns (HPQ); Finerman's firm owns (HPQ); Finerman's firm owns (IBM); Finerman owns (JPM) ; Finerman's firm owns (JPM) and (JPM) leaps; Finerman's firm owns (MCD); Finerman owns (MSFT); Finerman's firm owns (MSFT); Finerman's firm owns (TGT); Finerman's firm owns (WMT)

For Joe Terranova
Terranova is Chief Market Strategist of Virtus Investment Partners, LTD
Virtus Investment Partners Owns More Than 1% Of (ABAX)
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For Brian Kelly
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Accounts Managed By Kanundrum Capital Own US Dollar
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Accounts Managed By Kanundrum Capital Are Short the Australian Dollar

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For Rob Rutschow
Credit Agricole does and seeks to do business with NYSE Euronext.
Credit Agricole receives or has received compensation from NYSE Euronext for non investment banking services in the last 12 months.

For Rich Volpe
Volpe has no disclosures

For Joe Saluzzi
No disclosures on the exchanges.

For Mike Khouw
Cantor Fitzgerald & Co is a market maker in (SD)

For Alexandra Lebenthal
Lebenthal has no disclosures

FAST FIRE
Terranova had no disclosure in (RIMM) on 12/17/10

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