Suppose a site allows connection to be established with HTTP or HTTPS .If you establish a connection to http://www.example.com or https://www.example.com then all further link's on the page displayed will have HTTP or HTTPS correspondingly. I understand that an attacker can degrade your HTTPS connection to HTTP using MITM and then can takeover your account but i want to know that can it pose any other threat other than this ??
Not all links are restricted to your initial request; if you include the protocol (e.g: http or https), then you can jump between both. If you just have relative URL locations (such as: "/dir/page.php" instead of "https://site.com/dir/page.php"), then you'll stick to the same protocol.
Websites can implement Hypertext Strict Transport Security, this will force a browser to only use the HTTPS protocol for a website. The drawback is that the initial request remains vulnerable if it was done over a non-SSL channel.
An easy way to do an SSL-strip attack is, when you offer a WLAN access point at a place where already a public access point exists (Moxie Marlinspike did this to demonstrate SSL-strip). As soon as somebody connects via your access point and visits a website with the HTTP protocol, you can read everything he sends and return everything your want. If the first page would be requested with HTTPS, you could not read the content.
That's what the HSTS policy can mitigate, usually people visit important websites the first time at home in a safe network, later when they use a public WLAN, the stored HSTS header tells the browser to accept only HTTPS requests. This of course only works if the site delivers HTTPS only and does not return mixed HTTP/HTTPS pages.
Well yes seen as your now browsing the internet with cleartext requests and responses but only would prove a big issue with accounts as you mention. It wouldn't be an issue if your were browsing google per se. Moxie Marlinspike has done a lot of research into the SSL/TLS protocols and created a tool called sslstrip:here!. Thus the only threat is the attacker has control of all your traffic.