Rating Agencies

Tyler Durden's picture

Black Swan 2: This Is "The Next Critical Chapter In The Austrian Banking System Story"





"A relatively low-profile entity in Austria – Pfandbriefbank Oesterreich AG (Pfandbriefbank) – is becoming the next critical chapter in the Austrian banking system story." - Daiwa

 
Tyler Durden's picture

ECB Prepares For Grexit, Anticipates 95% Loss On Greek Debt





Dear Greek readers: the writing is now on the wall, and it is in very clear 48-point, double bold, and underlined font: when the ECB "leaks" that it is modelling a Grexit, something Draghi lied about over and over in 2012 and directly in our face too, take it seriously, because it is time to start planning about what happens on "the day after." And incidentally to all those curious what the fair value of peripheral European bonds is excluding ECB backstops, the ECB has a handy back of the envelope calculation: a 95% loss.

 
Tyler Durden's picture

How The ECB Is Distorting Euro Money Markets





Central banks' ability to distort markets, inhibit price discovery, and create systemic risk is alive and well as ECB asset purchases ripple through euro money markets. "The ECB’s liquidity bazooka will likely create the conditions for all rates money markets to stay in negative territory. This would represent a very challenging environment for investors, especially those focusing on the euro money markets, whose resilience to negative rates has not fully tested yet," Barclays warns.

 
Tyler Durden's picture

Breaking Bad (Debt) - Episode 2





Under normal circumstances, after 2008's conflagration of the calamitous collateralizations, we shouldn’t have seen such irrational, reckless, greedy behavior from Wall Street for another generation. But, Wall Street didn’t have to accept the consequences of their actions. They were bailed out and further enriched by their puppets at the Federal Reserve, the lackey politicians they installed in Washington D.C., and on the backs of honest, hard-working, tax paying Americans. The lesson they learned was they could continue to take excessive, reckless, unregulated risks without concern for losses, downside, or consequences.

 
GoldCore's picture

EU Warns of Debt Dangers Facing Ireland and Euro Zone – “Emperor Has No Clothes”





The levels of spin and denial are reminiscent of the run-up to the 2007 crisis. We and many others were ignored for highlighting the dangers facing the Irish and global economy then and are being ignored again now.

 
Tyler Durden's picture

Hedge Funds Underperform The S&P For The 7th Year In A Row: Here Are Their Top Holdings





Maybe one day investors, or at least the 1%-ers, will finally grasp that in a centrally-planned world in which the central banks themselves assure that there is "no risk", there is also no point in paying billionaire hedge fund managers 2 and 20 to "hedge" away risk, since there simply is none left.  However, since most people are too lazy to do any work (this includes hedge funds themselves), and would rather piggy back on other people's work (such as the rating agencies back in 2005-2007) that day is still far away. So for the time being, to satisfy everyone's natural curiosity why hedge funds continue to suck so bad, here are their biggest long, and far more importantly short, positions.

 
Sprott Money's picture

Standard & Poors Slashes Russian Credit to Junk, but Why?





The Russian economy continues to suffer. The absolute desolation of the oil market effectively destroyed the economy in Russia, which is incredibly dependent on the commodity. Job’s have been lost, the standard of living has collapsed and now the once proud Russian bond, is being attacked.

Standard and Poors, what some call, “the international credit watchdog” slashed Russian debt to BB+, one step below what the markets consider investment grade.

 
Tyler Durden's picture

S&P Downgrades Greece, Suggests Worst Case Scenario With Bank Runs And "Capital Controls": Full Report





And the hits keep coming. On the heels of a demand for repayment of ECB's profits from GGB bond gains and to extend the T-Bill limit to give the nation time to negotiate with EU leaders (i.e. a Bridge Loan) which Jeroen Dijsselbloem already dismissed earlier in the day, S&P just piled on...

GREECE RATINGS CUT TO B- FROM B BY S&P; MAY BE CUT FURTHER

This downgrade comes just 5 months after upgrading Greece because "risks to fiscal consolidation in Greece have abated." EURUSD is not moving much (having already cratered after US payrolls) but Greek stock ETFs are sliding once again.

 
Reggie Middleton's picture

The Auto Industry: Financing a bubble like you've never seen before...





Well, actually, we have seen this bubble before haven't we? Is GM really doing that well? In 2007, they did well too. In 2008 their finance arm= .gov bailout, 2009 GM Bankrupt! It's amazing what mainstream media will report, and even more amazing how many "smart" people (including analysts) will go along with it. Reggie's truth laid bare...

 
Tyler Durden's picture

S&P Settles DOJ Lawsuit For $1.5 Billion; Agrees Not To Accuse Government Of Retaliation For US Downgrade





As had been widely rumored in the past two weeks, and as the WSJ reported overnight, moments ago McGraw Hill, parent of disgraced rating agency S&P, entered into a $1.5 billion settlement to fully resolve the DOJ lawsuit regarding S&P ratings on RMBS and CDOs. As the WSJ reported overnight, In the "span of about 30 hours, the Justice Department lowered its asking price and backed off demands that S&P admit to violating laws when it issued rosy grades on risky mortgage deals, the people said." But the bottom line: 'S&P agreed to ... withdraw its assertion that the Justice Department lawsuit was political retaliation for the ratings firm’s 2011 downgrade."

 
Tyler Durden's picture

Greece FinMin: "No U-Turn" In Our Position; "Write-Off Can Occur In Several Methods" Spokesman Adds





a day after the FT report sent futures soaring and has been responsible for the jump in European stocks this morning, the Greek finance minister made it quite clear that, as has been happening on pretty much every day since his ascent to power, he has been misinterpreted and that as Bloomberg noted a little over na hour ago, "there has been no "U-turn" on the Greek debt position, adding that "Our promise is solid, debt will be rendered sustainable even if haircut replaced with euphemisms, swaps" Greece’s Finance Minister Yanis Varoufakis comments in Twitter post.

 
Tyler Durden's picture

Greece Changes Strategy: No Longer Demands Debt Write Off, Ask For Debt Exchange Instead





Update, and in line with the FT report, here's Bloomberg: GREECE SAID TO DROP WRITEDOWN REQUEST AFTER OPPOSITION FROM EU

Over a week after the new Greek government came to power, it has presented its first actual proposal of how it hopes to negotiate with Europe that does not involve the infamous "debt write off", which as both Germany and the ECB have made clear, is a non-starter as it impairs the ECB's balance sheet and leads to a loss of "faith" in the money printer, the legacy monetary system and so on. So instead of yet another debt restructuring, the FT reports that Yanis Varoufakis "would no longer call for a headline write-off of Greece’s €315bn foreign debt. Rather it would request a “menu of debt swaps” to ease the burden, including two types of new bonds." Actually he still does, only he is not calling it as such.

 
Tyler Durden's picture

For IBM The Buyback Frenzy Ends With A Bang As Q4 Revenues Plunge Most Since Lehman





Unfortunately for IBM, it better resume its financial engineering fast because this is where the bang (not the whimper) comes into play: in Q4, IBM's revenue was a modest $24.11 billion, far below the Wall Street estimate of $24.8 billion, and a whopping 12% less than what IBM generated a year ago. In fact, as the following chart shows, the annual plunge in IBM Q4 revenue was the worst since Lehman.

 
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