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Sell stocks, sell bonds, sell the dollar. Anything else?

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For Wall Street’s orneriest bears, Thursday’s U.S. market action was a dry run for the day of reckoning they believe is surely coming.

Stocks, Treasury bonds and the dollar all took sharp hits -- an unusual correlation that had ‘sell America’ scrawled all over it.

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Typically, a lousy day in the stock market is good news for Treasury bonds, as investors look for a safer place to put their money.

And when fear levels really spike, the dollar tends to be the world’s currency of choice, as it was during last fall’s global market meltdown.

On Thursday, stocks were broadly lower, with the Dow Jones industrials losing 129.91 points, or 1.5%, to 8,292.13; Treasury yields surged, driving the 10-year T-note to 3.35% from 3.20% on Wednesday; and the dollar was thumped, with the DXY index of the greenback’s value falling to its lowest level since late December.

One trigger for this ugly session was Standard & Poor’s warning that Britain might lose its AAA credit rating as the government goes ever-deeper into debt to bail out the economy.

On the face of it, that should have been bad for the British pound and good for the dollar. Instead, the dollar fell against the pound.

Some investors and traders viewed S&P’s stance on Britain as a warning about America’s AAA grade, amid our own soaring budget deficits to pay for the unprecedented wave of federal bailouts of the financial system, auto companies and, perhaps next, cash-strapped California.

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‘People are starting to ask questions about the U.S.’ credit rating,’ said Sophia Drossos, a currency strategist at Morgan Stanley in New York.

Bond market guru Bill Gross at Pimco in Newport Beach helped feed those fears, telling Bloomberg TV Thursday that while a cut in America’s rating was ‘certainly nothing that’s going to happen overnight,’ markets were ‘beginning to anticipate the possibility.’

That forced the other G-man -- Treasury Secretary Timothy F. Geithner -- to weigh in, telling Bloomberg in a separate interview that it was ‘very important that this Congress and this president put in place policies that will bring those deficits down to a sustainable level over the medium term.’ Duly noted. But that didn’t comfort the Treasury bond market, which is laboring under the huge supply of new bonds Uncle Sam is pumping out monthly. Yields jumped Thursday in part on disappointment that the Federal Reserve, which has been soaking up some of that supply by buying Treasuries for its own account, didn’t buy as much as traders had hoped this week.

Meg Browne, a currency strategist at Brown Bros. Harriman & Co. in New York, said the dollar’s latest slide looked like the work of momentum traders jumping aboard a pullback that began in late April, as optimism about some emerging-market economies fueled rallies in their currencies at the greenback’s expense.

‘I really don’t think this has a lot do with the fundamentals,’ she said, noting that it makes little sense for the British pound or euro to rise against the dollar given Europe’s own economic mess.

So, maybe this was all just some lightening-up by anxious traders clearing out early for Memorial Day weekend.

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To the bear camp, however, Thursday was a glimpse of what’s to come if the world finally decides, for whatever reason, that it has had its fill of U.S. assets.

-- Tom Petruno

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