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Moody's Says A Fresh European Slowdown Will Result In A New Round Of Rating Downgrades
According to Moody's semi-annual European Sovereign Outlook report, published earlier, the rating agency is once again on track to destabilize Europe, by firing the latest warning shot. In the report the agency, which at last check is still without a sovereign research head after the current one left some time ago, said that slower economic growth in Europe might spark downgrades to credit ratings for countries on the continent, as any slowdown could weaken the ability of individual countries to absorb additional shocks to the system, as cited by Dow Jones. "The ratings agency said that the fiscal and economic adjustments necessary to stabilize government debt ratios are likely to be difficult and painful." In other words more than magic may be required to keep the insolvent continent together (and for the very unshocking observation that Spain has been using its social security fund to buy up its bond to keep the false impression that all is good, read today's Frontrunning). In other words, the latest currency devaluation race is once again on. And for the time being the AUD seems to be taking its overnight mispricing from much lower fair values in stride.
More from Dow Jones:
"Given the magnitude of the fiscal challenge and the need to sustain tight fiscal policy for several years, the risk to economic growth are clearly a downside risk for sovereign ratings," the European Sovereign Outlook report said.
Moody's also noted the divergence continuing to spread as European countries cope with their individual fiscal positions.
"Another challenge is the need to manage the fallout from the wide discrepancies in economic and fiscal performance over the past few years," it said.
In this, the process of deleveraging might also be a specific danger to the ratings of certain countries.
"Those countries that are facing persistently strong deleveraging could experience renewed negative pressure on their ratings in the future, depending on how long the process lasts," Moody's said.
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No More Austerity Measures, Greek Government says
This should have gotten some notice!
Moody's is TOTALLY irrelevant!! What a waste..............
Now, all of a sudden, Moody's is making realistic observations? Where were they during the subprime debacle? Where are they reporting on US and British debt levels? No concerns?
Not that they are wrong here, but me thinks he doth protest too much.
Must be europe's turn in the barrel...long the dollar...til it's our turn again.
'Frontrunning'. where art thou ?
Moodys... just close that whorehouse down.
Deep Shah.
A "fresh slowdown" the sweet new name for the double dip, continued dip, or second lost decade.
Moody's dives deep into the phone booth and emerges as:
CAPTAIN OBVIOUS!
No shit.
My day has been made, my intellectual curiosity overwhelmed. My shortfall of morals, ethics and character repaired. My cup runneth over. Sunlight subsumes the darkness in which I have struggled. The pee in my pants stays warm. I am happy and content. They make me lie face down in still waters. They steal my soul.
(Primal Scream)
And it's all predicated upon the European Stress Test results.
Arrrrrrraaaaaaaggggggggggggggggahhh.
(soft whining sounds)
Uh boss? Best send Knukles home, dontcha think? I know its before the open on Monday morning, but that just doesn't sound right this early in the week, even for him and...
Self-defeating Moody-like logic: Deleveraging, from the mountain-high pile of debt,
deleveraging, deleveraging, everyone !!
'Avoiding disorderly deleveraging'
http://voxeu.org/index.php?q=node/1115
The FT had it last week: China, diversify, diversify, diversify
why does this article have a "not so fresh" feeling to it? like deja vu all over again...
You know things are bad in Europe when Greece and Serbia get into a nasty basketball brawl:
Is is just me, or has everyone with a finger on a button gone totally batshit insane? I think the clowns at the ratings agencies must get together with Bernanke's Rat-Pack, and they piss themselves laughing...
"Wait! Wait! I've got a great one! How about MORE Q.E.? HAHAHAHAHA!! Let's see anyone try to buy anything after THAT! We'll be able to export to MEXICO!"
"Ooooohhh, that's a good one, but...WE'RE GOING TO DOWNGRADE EUROPE AGAIN!! Forget about 'frosty' credit markets...by the time we're done, they won't be able to borrow a cup of sugar! BWHAHAHAHAHAAAA!! Hey, anyone else want some more of this coke?"
At that point, Geithner vomits from the twelfth beer that he's just finished funneling.
Thanks for such a great post and the review, I am totally impressed! Keep stuff like this coming!...
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