Standard and Poor's may have cut U.S. credit ratings to AA-plus from AAA but in reality, the country deserves a junk-bond rating, says Dick Bove, a banking analyst at Rochdale Securities.

Just at look at the country's balance sheet and analyze it as if it were a company for a little guidance.

"You've got a company which is losing about $1.4 trillion this year, probably will lose somewhere around a trillion dollars over the next couple of years. It owes $14.4 trillion (and) over the next five years that will get up to $20 trillion," Bove tells CNBC.

"So there's no likelihood whatsoever that this particular company is able to pay down from its own resources the amount of debt that it has, nor is there any likelihood that it's going to get rid of its deficit," Bove adds.

"If that was a real company, of course, that would be a junk bond."

The Dow Jones Industrial Average plummeted by over 600 points on the news of the downgrade, although Bove says now is not the time for bottom-fishing.

"I still would expect to see a thousand-point down day at some point in this market as people come to realize there has been a complete change in the financial structure of the world."

Gold, meanwhile, has surged past $1,700 an ounce as investors are fleeing to the precious metal as a hedge against market volatility and global economic uncertainty.

"Against this backdrop, together with strong Asian gold demand and continued purchasing by central banks, gold continues to demonstrate its attributes as a hedge against credit risk, currency and inflation/deflation risk," Marcus Grubb, managing director of investment at the World Gold Council, tells CNNMoney.