Rating Agency

The State Of Illinois Is "Past The Point Of No Return"

"The State of Illinois is past the point of no return. It does not have the ability to raise taxes or cut spending to the degree necessary to reduce the annual cost of bond and retiree benefits from 33% to a sustainable level...The insolvency is not the result of too much bonded debt, but rather the government promising retirement and other post-employment benefits that aren’t affordable."

The 'Real' Peak Complacency

"Stocks are at record highs while volatility is at a record low. Which is another way of saying that investors aren’t as worried as they probably should be about the coming year... But there’s another area of Peak Complacency that is neither natural nor benign. And that’s cyberspace... "

Dollar Surge Continues Ahead Of Jobs Report; Europe Dips As Catalan Fears Return

World stocks eased back from record highs and fell for the first time in eight days, as jitters about Catalonia’s independence push returned while bets on higher U.S. interest rates sent the dollar to its highest since mid August; S&P 500 futures were modestly in the red ahead of hurricane-distorted nonfarm payrolls data

Is This The Biggest Housing Bubble Ever?

"Macroprudential, particularly if markets are going up, up, up is about saying ‘no’. Apparently that’s hard to do," the head of the Swedish central bank, Stefan Ingves, said...

Frontrunning: September 29

  • Republican Tax Plan Hits First Hurdle (WSJ)
  • A $6.4 Billion Windfall Awaits Big U.S. Banks in Trump's Tax Cut (BBG)
  • How Does the Trump Tax Plan Affect You? WSJ Answers Your Questions (WSJ)
  • Twitter suspends Russia-linked accounts, but U.S. senator says response inadequate (Reuters)
  • Flight ban on Iraqi Kurds imposed after independence vote (Reuters)

Pound Flash Crashes After Moody's Downgrades UK To Aa2

In an otherwise boring day, when Theresa May failed to cause any major ripples with her much anticipated Brexit speech, moments ago it was Moody's turn to stop out countless cable longs, when shortly after the US close, it downgraded the UK from Aa1 to Aa2, outlook stable, causing yet another flash crash in the pound.

S&P Downgrades China To A+ From AA- Due To Soaring Debt Growth

"The downgrade reflects our assessment that a prolonged period of strong credit growth has increased China's economic and financial risks. Since 2009, claims by depository institutions on the resident nongovernment sector have increased rapidly. The increases have often been above the rate of income growth."

Analyst Lays Out China's "Doomsday" Scenario

According to Autonomous analyst Charlene Chu, bad debt in China’s financial system will reach as much as $7.6 trillion by the end of this year: an estimate which implies a staggering bad-debt ratio of 34%, orders of magnitude above the official number, and nothing short of a "doomsday scenario" for China's financial system if accurate.