Ree

S&P's Downgrade of Financials Is a Definitive Bear Signal

It really matters little what the "stand alone" ratings are. If the debts are guarenteed by the government, they are as good as golden for now. Who's really going to be able to see three years down the road? As long as the banks survive, somebody's going to find some ways to make a lot of dollars. If you are investing for the long term, they are so cheap that whatever risks are worth taking. If you are just trading, both long and short positions are fun to play with.

The worst kind of bet is to "keep shorting them because the numbers don't add up". You'll learn a hard lesson: Economics is not just about pure numbers, it's about people, time and policies as well.