Leigh Gallagher and Cardiff Garcia discuss the latest European downgrade and whether the U.S. is going into recovery.

What the downgrade of France means:

Leigh Gallagher: It means a lot more when we’re talking about Europe because this is just so much bigger and it’s not going anywhere. We’ve known that for months — in December, S&P actually put all these countries on warning, so we’ve really been on guard for this. But even so, today really did have a feel of a Black Friday.

On Wall Street’s tepid response:

Cardiff Garcia: I don’t think it went haywire for a number of reasons, but the one thing is that I don’t think Wall Street was that shocked by it. We had some sense that it was coming. I also don’t know that the impact is going to be so bad — it is only one credit rating agency. It might complicate things a little further — France is one of the countries that also guarantees the European bailout facility. So it’s just one more thing.

For more analysis, listen to the full audio above.