Wall Street Responds To The French Downgrade

Tyler Durden's picture


From buy French bonds and the EUR, to sell French bonds and the EUR, every possible opinion is included in the list below.


  • Wider OAT/bund spreads may attract investors after the rating downgrade, head fixed income strategist Christoph Rieger says
  • Cites January move in spreads
  • Sees risk of downgrades in other core countries


  • France downgrade is an omen for Germany’s rating
  • Netherlands and Austria may also face rating action

Credit Agricole

  • Strong buying of French debt to continue, strategist Peter Chatwell says
  • Model shows 7-year non-German core debt expensive vs shorter maturities

RBC Capital

  • Keep buying 5-year French debt after rating cut; move was priced in, note to clients says
  • French spreads were already wider to other top-rated countries
  • Expect EFSF’s Aaa rating to be downgraded by Moody’s in coming days

BNP Paribas

  • EFSF may be downgraded by Moody’s in a few days, BNP says
  • Cites French downgrade, says ESM is different


  • French downgrade highlights rating risks posed by Spain, which Nomura thinks will lose its investment-grade rating


  • “Massive selling pressure” unlikely in event of EFSF downgrade

Societe Generale

  • Luckily for France, global sentiment is “risk on”
  • Prudence is a good strategy going into year-end
  • OLOs will re-converge with OATs, note to clients says

Morgan Stanley (in note before latest rating downgrade)

  • French downgrades may not lead to forced selling
  • No Index-driven selling seen

Source: Bloomberg

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Tue, 11/20/2012 - 07:46 | 2998227 Shizzmoney
Shizzmoney's picture

Luckily for France, global sentiment is “risk on”

For some reason

Tue, 11/20/2012 - 08:09 | 2998247 GetZeeGold
GetZeeGold's picture



We threatened we'd tax them to death....so they left.


Can they do that?

Tue, 11/20/2012 - 07:49 | 2998230 buzzsaw99
buzzsaw99's picture

good job boyz take another bonus from petty cash

Tue, 11/20/2012 - 07:55 | 2998238 ZippyBananaPants
ZippyBananaPants's picture

"What's in the box?"

Tue, 11/20/2012 - 07:59 | 2998241 ziggy59
ziggy59's picture

Hopium Koolaid Punch refill...

Tue, 11/20/2012 - 08:03 | 2998242 falak pema
falak pema's picture

musical chairs, whom do we clobber next in this "fixed" market; anything to make a crazy buck before the ship goes belly up.

Hollande loves cheese. He wil have to defend his camembert. "Mutti, Mutti where are you when I need you?"

"Ha you socialist, down on your knees, and get your competivity package in place or I'll sing : Nein, Nein, Nein....

I am now into Ost politik big time. So puleeze my time is very precious." 

Meanwhile on the Eastern front, this : La Russie prévoit d'investir 125 milliards d'euros dans l'Extrême-Orient

Not only was Mutti in Moscow but also Sarko on private visit. Putin has such big Keynesian plans : "all to be financed in EUROS", (hint hint), "that there is place for everybody here! "

I see Hollande taking the next train to Moscow. 

Tue, 11/20/2012 - 08:11 | 2998256 BraveSirRobin
BraveSirRobin's picture

It's like the White Star line doubling up on efforts at selling non-refundable tickets on the Titanic as they listen to the distress calls on the wireless. 

Tue, 11/20/2012 - 08:13 | 2998260 GetZeeGold
GetZeeGold's picture



....and the band played on.

Tue, 11/20/2012 - 09:22 | 2998364 El Viejo
El Viejo's picture

Yeah, lemme guess. The VIX is still unmoved. (Not a very representative formula, huh?)

Tue, 11/20/2012 - 08:11 | 2998257 EscapeKey
EscapeKey's picture

CCC is priced in already.


Tue, 11/20/2012 - 08:16 | 2998262 youngman
youngman's picture

actually it is not.......but by then...that will be a flight to safety bond.....as the others will be FFF or EEE by then

Tue, 11/20/2012 - 08:19 | 2998263 LongSoupLine
LongSoupLine's picture

I respond to Wall Street:

Eat shit and die assholes!

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