Wall Street was spooked Monday, there's no doubt about that.
At the end of the day, the Dow Jones industrials had fallen nearly 635 points, its sixth-worst performance in 112 years, and every single stock in the S&P 500 had dropped.
The biggest lightning rod, of course, was the historic decision S&P made late Friday to downgrade the U.S. government's credit rating from AAA to AA-plus, the first time in the history of the ratings that the United States' government hasn't had the top rating.
But Wall Street observers say that there are other factors that entered into the Monday market malaise. Europe -- specifically Spain and Italy, which have much larger economies than beleaguered Greece -- are causing concern, especially since countries tied to the euro have little choice other than to borrow to compensate for flagging member economies.
Perhaps even more than the debt rating, investors are getting skittish over U.S. economic growth, which is showing signs of coming up short of expectations. And then there is the awareness of the snowball effect that dragged the world economy into a deeper recession a few years ago when market fears fed on themselves, creating a self-fulfilling prophesy.
Meanwhile, our good folks in Washington, D.C., are doing what they do best when facing trying circumstances -- they're pointing fingers at each other and envisioning political dominance.
While other credit rating companies have so far continued to give the U.S. their top rating, it's anybody's guess as to whether that will hold up. Meanwhile, S&P, which doesn't have the most pristine record of guestimating creditworthiness given its inability to see the problems that led to the Great Recession, is finding itself coming under the microscope from Senate Democrats, who think the move Friday was irresponsible, and likely the Obama administration, which contends S&P erroneously came to its conclusion to downgrade because of faulty math.
Of course, it's hard to see how S&P, or any agency for that matter, could be expected to understand government math, given some of the cockamamie cyphering that comes from the Hill and White House, so we'll have to see how that particular math lesson works out.
What it boils down to -- or at last what it appears to boil down to -- is old-fashioned fear.
The recession showed what can happen to historically safe investments when things go terribly wrong and the economy goes into a deep freeze. That memory is fresh on everyone's mind, and most of us can still feel the chill.
So, it's natural that people would look for a safe harbor for their investments until they can determine whether this is just an unusually cold wind or another frigid economic winter setting in.
This would be an excellent time for a few politicians to stand up and become statesmen, public servants who are able to cross party and ideological lines to develop a plan -- one that is prudent with the national checkbook and credit card -- that is good for the country now and in the future.
America spent a big part of the last century leading the world, and we can do it again. We have to.
Otherwise, we all better bundle up.