“Political brinksmanship” has made the US government’s ability to manage its finances “less stable, less effective and less predictable”: That was the official statement from credit rater Standard & Poor’s when it cut Uncle Sam’s credit rating below AAA for the first time in 70 years.

Moreover, the rater has held out the threat of further downgrades by keeping the US credit outlook “negative.” That prognosis stands in stark contrast to S&P’s view of Canada, which it continues to rate AAA with a “stable” outlook.

Logically, investors should now demand a higher return on US Treasuries in exchange for the greater risk embodied in a lower credit rating. Ironically, Treasury bonds have continued to rally in the face of the S&P downgrade, just as they have in recent weeks when the US government appeared in danger of a first-ever default.

True, Moody’s declined to follow S&P in its downgrade–stating its expectation that the deficit will be cut satisfactorily in coming years. But the main reason for the Treasury rally is worries about the global economy continue to trump any other concerns. And Treasuries are still the only market large enough to absorb all the money seeking safety, particularly since Europe’s sovereign debt troubles are arguably worse.

Canada’s banking system is sound, its economy moving and its government deficits under control. Yet the country’s currency and stocks are also suffering in today’s panic. And they will continue to until markets inevitably calm down–as investors retreat to Treasuries.

Fortunately, there is a silver lining for investors in Canadian stocks. As I pointed out in the August issue of Canadian Edge the Canadian dollar has shown some very real signs of shedding its reputation as a “petrocurrency,” always following the price of oil up and down. Up until this week, for example, the loonie has remained staunchly above parity with the US dollar, despite the fact that oil itself has plunged under USD85 a barrel.

Second, last week the yield on the 30-year Canadian Treasury bond hit its lowest level since 1970, when records were first kept. Though the Bank of Canada may still tighten monetary policy a bit in the coming months, low Canadian Treasury rates and healthy banks mean low borrowing rates for Canadian companies. And low rates mean lower interest costs and a golden opportunity to make low risk investments in future growth.

We’ve seen that virtuous cycle at work with the Canadian Edge Portfolio companies reporting second-quarter earnings analyzed in the August issue. Today EnerCare Inc (TSX: ECI, OTC: CSUWF) added its own set of robust numbers, posting a solid 17 percent gain in second-quarter revenue, a 1 percent increase in cash flow and a decrease in its payout ratio to just 50 percent of distributable cash flow from 52 percent a year ago.

The company’s submetering operations were the star, with revenue increasing nearly six-fold. Now that regulations have been worked out in the principal provinces, submetering has proven wildly popular as consumers–particularly apartment landlords that pay tenants’ heating bills–have signed on at record rates to conserve energy.

Submetering growth offset a 5 percent decline in waterheater rental revenue, caused mainly by the company’s efforts to make them more profitable. On that score renter attrition rates fell for the fifth consecutive quarter, and the company was able to raise rates as well.

The expiration of a regulatory order in February 2012 should further boost the competitive ability of this business, and give a lift to revenue. So should the expansion of the company’s water heater relationship with Enbridge Inc (TSX: ENB, NYSE: ENB) to New Brunswick, its first move outside of Ontario.

Looking ahead, EnerCare’s business model looks increasingly conservative and stable. There’s very little exposure to near-term credit pressures. And continued growth of sub-metering coupled with the low payout ratio eventually points the way to dividend growth. Paying a monthly dividend with a very generous annualized yield of 8.6 percent, EnerCare is a solid buy up to USD8.

I’ll have more analysis of CE Portfolio recommendations’ earnings as they appear. But these solid results more than anything else underscore why this selloff is another strong opportunity to buy Canada.