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S&P Places Portugal On Watch Negative, May Cut A- Rating
This is getting ridonculous: "On Nov. 30, 2010, Standard & Poor's Ratings Services placed its 'A-' long-term and 'A-2' short-term foreign and local currency sovereign credit ratings on the Republic of Portugal on CreditWatch with negative implications. The transfer and convertibility assessment remains 'AAA'." The only that matters: what does Dagong say. Our clown rating agencies are way overdue for retirement watch imminent. If the market is totally retarded, we guess the EURUSD may be whacked on this news.
Portugal 'A-/A-2' Ratings Placed On Watch Negative On Uncertainty Regarding The Effects Of The Proposed EU Treaty Change
Overview
* Standard & Poor's is assessing the proposed EU treaty changes regarding the seniority of private-sector creditors.
* We are placing our 'A-' long-term and 'A-2' short-term ratings on Portugal on CreditWatch with negative implications.
Rating Action
On Nov. 30, 2010, Standard & Poor's Ratings Services placed its 'A-' long-term and 'A-2' short-term foreign and local currency sovereign credit ratings on the Republic of Portugal on CreditWatch with negative implications. The transfer and convertibility assessment remains 'AAA'.
Rationale
The CreditWatch placement reflects our view of increased risks to the government's creditworthiness. These risks stem from uncertainty about the government's possible recourse to official funding and the consequences that obtaining such funding could have for the position of private-sector creditors vis-à-vis official creditors after 2013.
In 2011, Portugal's minority government is set to implement an ambitious fiscal austerity program with an emphasis on reducing expenditures. However, we see the government as having made little progress on any growth-enhancing reforms to offset the fiscal drag from these scheduled 2011 budgetary cuts. In particular, we believe that policies the government has pursued have done little to boost labor flexibility and productivity. As a consequence of the Portuguese economy's structural rigidities and the volatile external conditions, we project that the economy will contract by at least 2% in 2011 in real terms. The downward revision to our growth projection also reflects the fact that Portugal has not reduced its large external current account deficit during 2010.
In addition to what we view as the economy's weak growth prospects, the large stock of Portuguese debt that non-residents hold (54% of GDP) has increased the government's vulnerability to rising real interest rates. This contributes to the country's large gross external financing needs and, we believe, raises the likelihood that Portugal will seek external assistance from the EU.
What Portugal does to combat downward pressures on growth and under what terms it accepts external support--if it does at all--will influence the government's creditworthiness. The Eurogroup Ministers recently proposed treaty changes to establish a permanent crisis mechanism to be called the European Stability Mechanism (ESM), which will be based on the European Financial Stability Facility. It is our understanding that the ESM may be designed to rank ahead of private creditors in any future debt restructurings beginning in 2013. As a result, debt that European Monetary Union member states issue might not rank pari passu with debt that the ESM issues. We think that this treaty change would represent a move away from the original design of the European Financial Stability Facility, which was intentionally exempt from preferred creditor status by the 16 members of the Euro Area in an effort to assist European Monetary Union members in financial difficulties.
CreditWatch
We expect to resolve the CreditWatch within the next three months. If Portugal does seek an external support program and if we believe private creditors will be subordinated to public creditors, or if Portugal's fiscal or growth prospects weaken further, we could lower the long- and short-term ratings.
Even if we were to downgrade Portugal, we would currently expect the ratings to remain in the investment-grade category. If Portugal does not seek an external support program because of better-than-anticipated fiscal performance or the passage of growth-enhancing reforms, we would view the likelihood of it needing external official support as reduced. As a result, we could affirm the ratings at 'A-/A-2'.
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Every SS Titanic needs a ratings firm to guide it lead by Captain Obvious and First Mate Toll Yaso. Rocket science it ain't
Is it just me, or are there way more clowns in the circus this year?
Speaking of -Ve ......
BoA & that now trending 2009 computerworld interview with Assange......
"At the moment, for example, we are sitting on 5GB from Bank of America, one of the executive's hard drives," he said. "Now how do we present that? It's a difficult problem. We could just dump it all into one giant Zip file, but we know for a fact that has limited impact. To have impact, it needs to be easy for people to dive in and search it and get something out of it.
http://www.computerworld.com/s/article/9139180/Wikileaks_plans_to_make_t...
well we know the leak didn't involve goldman sachs because a federal prosecutor just told a new york city jury that goldman sachs is jesus and sergey aleynikov is judas ! you can't make this shit up.
http://www.businessinsider.com/goldman-sachs-vs-sergey-aleynikov-judas-m...
doing the God's work is not easy
Get out the Popcorn .... Maybe Nachos also ?
...."Shares of Bank of America (NYSE: BAC) are now down almost 75% in the past three months, making this former bank bully's market cap substantially smaller than that of Wells Fargo (NYSE: WFC) and just half the size of former competitor No.1 JPMorgan Chase (NYSE: JPM).
Most of the plunge came in the last week, as B of A's deal to purchase Merrill Lynch prompted a second helping of bailout funds to help cover massive Merrill losses.
Shareholders are infuriated -- as they should be -- and have filed a class action lawsuit against CEO Ken Lewis and former Merrill CEO John Thain in protest. The outrage ultimately led to Thain's resignation earlier today.
maybe it's time for mister lewis to lawyer-up
Came in for the Donkey Kong pic, left disappointed.
... but it's still on ...
Eh, I liked the ridonculous switch up. Gave me a chucke.
Why does S & P or Moodys or Fitch move ANY market anymore. Useless except for cover up and preventing Mark to Market. Urgh!
Now let's be fair. Covering up and preventing Mark2Market are still valuable services today. In fact, I don't imagine the current global economy can go forward without them.
Good point. I temporarily forgot that we're in medicated and manipulated market-land.
Off course.
As the great walstreetpro2 once said "when you're borrowing money just to pay interest, you are @#$%ed."
not if you use infinite amounts of leverage! oops. my bad.
+100
Thank God for such FORESIGHT from S&P
All misallocations of resources come to an end.
are those misallocations supposed to be shaped like a giant pecker aiming at my end?
Really - they are three countries behind. Lame.
This is what it's going to look like in the US once the Fed bails out the first state. The market will understand you're either as good as a treasury or screwed.
What is S&P, a bunch of Frenchmen?? France is A-OK, Portugal got rating problems though? All ridiculous.
For all the angst produced by all these European credit implosions...
Wonder whey the SPY is not off by at least 15% - 20%?
Gee, genius...maybe because Barnanke has carte blanche to support anything and everything with an endless paper printing machine?
Wait till the Chi-Comms raise rates this week end. You'll be burning Benjamins in your fireplace because their cheaper than wood.
Nice chart Robo. How many head and shoulders can a body have? Three bullet Russian Roulette.
a 5 year chart of SPY tells a different story than that 2 year above. hey robo let's go all-in; how about a 2 year chart of NFLX ?
Must have faith Robo. It will crumble. When? At some point the fraud and manipulation will catch up. The enormous pile of shit will take down the structure feeding and supprting it. Sadly then we not only lose our market, but our freedoms most likely as well.I used to think we'd end up like Japan in a best case scenario, not any longer.
portugal largest bank milleniumbcp is in deep trouble, banking crisis in the making
Unrelated, but even after the asskicking CEU got it was still a good short today.
These clowns take their time and the rating agency dance never seems to stop...
Others were way ahead of them, on the 23rd notayesmanseconomics highlighted Portugal's fundamental problem.
Ben B prints money...ECB talk with S&P....both devaluate
What? No IGTE chart?
http://stockcharts.com/h-sc/ui?s=IGTE&p=D&b=5&g=0&id=p47566294294
S&P, a day late and a dollar short as always. Why does anyone listen to these clowns?
A joke, our rating agencies don't know what to do anymore than just to play along.
Dominos... Bitchez.