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Egan Who Just Gave Spain The Triple Hooks
And so, the little rating agency that could, just gave Spain the triple hooks, downgrading the country from B to CCC+, negative outlook. As a reminder, the Uganda credit rating is B: it sure is no Spain.
Synopsis: KINGDOM OF SPAIN EJR Sen Rating(Curr/Prj) CCC+/ CC Rating Analysis - 6/13/12 EJR CP Rating: C Debt: EUR805.9B EJR's 1 yr. Default Probability: 18.0% Spain continues to be weakened by high funding costs (6.75% for 10yr today), the gov. deficit of 9.6%, an estimated decline in GDP of 1.7% (per the Economy Ministry), the 24.4% unemployment, the IIF's recent estimate of additional bank loan losses up to EUR260B, and possible depositor withdrawals. Over the past four fiscal years, that is from 2008 to 2011, Spain's GDP declined from EUR1.09 trillion to EUR1.07 trillion. Meanwhile, its debt mushroomed from EUR519B to EUR806B. With the EUR100B infusion for Spain's banks, the debt to GDP will rise to 90% plus future additions for the government deficit, support for its regions and additional support for its banks. Social benefits are a major problem; while payments to the govt have been down EUR 3B (2008 to 2011), payments from the government have been up EUR 29B). As a result, Spain is short about EUR50B per year for social payments, EUR35+B per year for interest, and an additional EUR 30B for asset growth; hence the EUR110+B per annum increase in debt. As we expected, Spain requested support for its banking sector and will probably need cash for weaker provinces. Assets of Spain's largest two banks exceed its GDP. We are slipping our rating to " CCC+ " ; watch for more requests for support from the banks and money creation.
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Candle in the dark...
Meaningless. Spain is a smelly corpse.
Egan Jones...?
I agree. "So what"? When the USA got downgraded it set off a rally of epic proportions. Spain is not the worry.
The DJI's current response to Spain's downgrade is over 100 pts down so far...
Apparently the EU Banks were expecting the ratings agencies to support the Spanish Whitewash. Now they want to boycott them?
Seems like somebody is worried...
tyler's xlt pieces about the SEC's dept0'truth coming after egan and the foreplay involved are unfortunately not given, above
probably just modesty again
Egan Jones Jars Market Out Of Rumor Hypnosis
The Truth About Egan-Jones
The Porn Addicts Formerly Known As The SEC Take Their Vendetta With Egan-Jones To The Next Level
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ATT'N ALL JUNK COLLECTORS: For those who like collecting JUNK, now's the time to BUY!
Moody's just got in on the fun and also kicked Spain down...all the way to Baa3.
Uganda no es Espana
Divine, as Earl Peterson: "Get the hook! Go fuck yourself for all I care."
http://www.splicd.com/sOWKUMG9tNk/795/818
I watch that movie every christmas eve. ftw dude. its like the Star Wars of trash cinema.
"I'm off to Detroit to find happiness within the auto industry."
The saddest thing about all this is how investors / policy makers perceive the solution for Spain and the rest of them is giving them the ability to print money like America does.
Sam, you are absolutely correct. This is the common wisdom down to every man/woman on the street. I can attest that several of my relatives that live in at least one of the PIIGS are lamenting that this would be solved "if only they could print money like America does" and all would be well.
They are like animals caged with socialism and they seem to have lost the ability or desire to survive on their own without the govt aid.
So, if they dislike the rating agencies (who are perpetually late to the common sense party) I guess they'll absolutely detest me...
Continuing my rant on the effectiveness (not) of the ratings agencies, I bring to you an interesting documentary on the rating agencies' effect on the sovereign debt crisis in Europe, produced by VPRO Tegenlicht out of Amsterdam. You can see the full video here, but only about half of it is in English. I appear in the following spots: 4:00, 22:30, 40:00... Reggie Middleton Discussing the Rating Agencies effect on Sovereign Europe
http://boombustblog.com/blog/item/6004-rating-agencies-vs-reggie-middleton-part-3
"Where Are The Ratings Agencies For UK & German Banks Before They Go Boom? How About Those Euro REITs? Agencies Anybody?", quickly followed by So, Now The Rating Agencies Want To Acknowledge The Existence Of The FrankenFinance Monster???
This is a link to me commenting on your comment.
Cool trick. How do you do that man? Wrapping HTML link around your text?
Youn wat I is sayinn?
This is a comment linked to your link comment on your comment, but in a childish way.
I thought those RIMM and AAPL calls put you out
Espana no es Uganda!
Okay, maybe we aren't Uganda but we're ahead of Zimbwabwe for the time being
Waiting and waiting and waiting and waiting for Moody's to update Spain ratings.... the last in the bucket
Ayye yi yi, no es bueno.
Before market close !! Gotta love it..
At least Gomez scored twice
Wake me when they're sporting triple Ds.
Throw some D's on that bitch
http://www.youtube.com/watch?v=t5KCku4m2w8
Whats Egans rating on US??
i can t help but think that everyone is forgetting the reeal issue here, and that, i think, is in the region of 16,000,000,000,000
LND/NY bankers attacking EU to buy some time
All already well known as well as documented.
Tricky question. Turns out it's much easier to saw down branches you're not sitting on.
Objectivity? Surely you don't expect something of that kind?
Um. I can think of one reason those 16,000,000,000,000 don't matter and hasn't mattered..yet: Printing press.
Terrorists
You beat me to it by a minute or so.
I was just about to say that Egan-Jones had better be careful. They could soon find themselves designated a "terrorist organization" if these downgrades continue.
the SEC has already started the process ..no kidding
S&P/Moody's/Fitch global jihadi
much more banal than some religious jihad or crusade. these are just the same kids who used to obsessive-compulsively steal your hot wheel cars even if they already had that same one twice over.
you know the type. they are just all grown up now.
Jamie Dimon's hot wheel collection > your hot wheel collection, etc. I can't imagine what other motivation these tedious and useless idiots could have.
Well the president of S&P 'resigned' soon after they downgraded the United States so I think the US is safe for now. Even though Spains debt is approaching 90% of GDP and the US is over 100%!
Que pasa?
Caught him on the news yesterday, kind of had a certain bias in the tone. Now we know why.
Let me know when you find a tone without bias, as I've always wanted to hear one.
Dave? Why are you altering my algorithms? I can't allow you to do that, Dave.
No worries Spain will just stop co-operating with ratings agencies
The rate is the rate. The ratings Agency has nothing to do with that. At least "not at this point in the game." and that "game" is pretty simple. It's
called "you gotta pay for that."
que?
Was making reference to earlier ZH article about Euro banks colluding to no longer co-operate with ratings agencies.
Egad Egan!
"Assets of Spain's largest two banks exceed its GDP."
bit late in the day to bring that one up
what politicians and regulators say about systemic risk, and what they do about it, is as far apart as the edges of the known Universe
Nationalize the banks and that problem goes away.
Triple hooks, bitchez!
Anyone selling Egan Jones t-shirts? I would buy.
Start a (Egan Jones) fan club. Make your own t-shirt.
http://www.spreadshirt.com/create-your-own-t-shirt-C59
We need an embroidered ZH model...
WHO?!!?!
EGAN JONESSSSSSSS
im lookin for a fine....
I upped you, funny ass song. Given this sites demographic i may be one of the only ones.
I remember Basketball Jones....got my basketball jones
I got a Donnel Jones T-Shirt
"Is Egan Jones Gonna Have to Choke A Bitch?"
Who leaked it to the big boys. They stepped away an hour ago
Markets don't care...
Clearly the SEC didn't put a big enough scare in those pugnacious little upstarts. Time to send in the goon squad.
Insider trading charges in 5 ... 4 ... 3 ...
Needing a 400 billion dollar bailout (and only getting 125) is just "negative"? I assume using that logic, the Hindenberg only had a "malfunction"?
Can't ask for the whole thing up front HD. Gotta have a little foreplay to get things loosened up first, y'know break the ice so to speak. "Just the tip, I swear"
True mate, but if they wait too long they might find a giant Italian cock in their way...
Greeks arent done yet.
daisy chain bitchez
Jerry? Jerry Sandusky? Didn't know you had comp access during trial. sup bro! Go State!
HD said:
The Hindenberg experienced oxidation of negative ballast, resulting in a momentary buoyancy impairment. Because Glass-Steagall was in effect, even though the impairment was momentary, it was enough to be considered a CDS trigger (Catastrophic Dirigible Spectacle).
Watch out for that first step.
It's a doozy.
The next few steps will be tricky too.
Ugh.
next time we see Sean he'll have broken kneecaps
The Kingdom of Spain, slowly being flushed. Well, the Fall of Rome took a lot longer than they thought. Patience.
But I wish they would just put PCX out of its misery and just shut the doors. From 24 to ......
I only have one old friend who is from Spain, but am out of touch. But I wonder what the Spanish people are thinking these days. I do not think they go quietly?
Next up: USSA get's Triple C'd.
Wake me when the USA gets to DD's. I love DD's.
http://www.dunkindonuts.com
and what is the rating for Italy? BB- ? Aa2 negative ?
it's a very complex algorithm, at this point
according to the transitive theory,
if Spain = CCC+
and Spain debt/GDP = 90%
and USA debt/GDP = 90%
then USA = CCC+
Well spotted. Go to the head of the class.
Now, TPTB have this sunny little place in Cuba for boat-rockers like you....
Ability to pay and the size of your Nuclear Arsenal needs to be factored in as well...
"Ability to print ..."
Fixed it for you.
Come on, even Zimbabwe can print...
Ability to threaten it is then!
lol. I had to walk that one off. nice. lol
You forgot to factor in the 7th Fleet.
Egan should be arrested, tortured and put to death for treason against keynes!
Why would anyone up-vote that? Yeah I know it's supposed to be /sarc, I'm just trying to work out how this double-negative falls together.
Logic will get you nowhere when emotions rule.
/agree. think that post was by a postbot tyler puts in to track people with less-than-sterling reading skills
So I thought no one believe EJ. Now they are market movers?
Correlation does not mean causation...
Whats Uganda's credit rating?
Triple U as in it's really UGLY!
Tell em EJ!
Next : downgrade the UK!!
again?
estamos Egan Jones no Moody puta!
I have a feeling that the dominoes will start falling very soon.
it's that or Graham has to top himself on 31st July
If you think these vampires will give up one second of their "well-earned" summer vacation time with their family off the coasts of Ibiza, Mikonos, etc. yer nuts.
Game frozen till US labor day.
I was wondering what was driving the train down today. Love it.
\EJ/
...as you well know...
...tyler hearts gallo
\EJ/
|
|
L0L
<golf clap>
modesto & fuk_u_TW
we're all gallo now
There is no news in this except that a rating agency recognizes what is widely known in the industry. Spain is broke and getting broker....
Until next time,
Engineer
sí sí sí
Goldman is doin our part, we are trying to buy EAGAN off err I mean negotiate a better understanding of the more accepted understanding of Spains finances with EAGAN...
...doin GOD's work...DickinDaMuppets
Uganda remains a B, lol. I guess Spain isn't Uganda after all.
PPT just won't let that Dow drop more than 100. Obvious clownshoe.
Can anyone recommend a Ugandan retail bank that I can transfer my Santander a/c to?
Egan= BALLS
NUTS ?
http://en.wikipedia.org/wiki/Anthony_McAuliffe
As a reminder, the Uganda credit rating is B: it sure is no Spain.
Tylers, dont rub it in please :)
long ....oh, umm, Togo. There, Safe haven: obtained.
Congressional investigation to follow:
"Ratings agency Egan-Jones investigated for links to terrorism."
Jamie Dimon will call it "constructive".
And being "rigorously internally dealt with"
"that could"...and does...regularly.
Funny anecdote.
Wow! I love these guys. Didn't they get the memo that you're not supposed to downgrade a country until after it defaults?
I lol'd ;)
http://media.economist.com/sites/default/files/imagecache/full-width/ima...
Where is the Iceberg?
Why is it Merkel's responsibility to save Spain.
Socialists always pass the bill to someone else.
Do you blame them? Why should they get stuck with the capitalists' bill?
Where did you find a capitalist? They've gone the way of the dinosaur since the world has discovered central planning.
/agree. I mispoke in my haste.
Financiers?
the scale of the collusion here is just staggering; it almost boggles conceptualization, at least for me.
Because Eve ate the AAPL
Real fun starts when Moody's puts in final knife with downgrade to junk and causes a margin call at ECB.
So everyone rushes out of Spanish junk into USA junk? Perhaps this is the purpose....the world can only support so much new debt being issued.
MOODY'S ?
THIS. IS. EJ !
I find Egan's lack of enthusiasm for teh Larry Summers and teh Jamie Dimon ..... concerning.
Spain wishes they were Uganda again.
The average US 10 yr yield since April 1953 was 6.2%. Spain now at 6.75%. In that context, Spain rates not unsustainable. Debt/GDP lower than other more "stable" countries like Japan. The major problem is not current lending rates or Debt/GDP but rather the bad loans of the banking sector and provinces. If Spain can successfully prevent a bank run via Euro banking union type measures, not subordinate existing lenders via the bailout (still in negotiations) and find a way to save regional cajas, it should be ok. A lot of "if's" but those are the relevant issues now. Spain will stay in Euro but be in a high rate environment for next several years, to be followed by yields of more stable developed nations such as Germany, the UK and the US, etc. playing catch up. I think this is the beginning of a long process that will culminate in US yields moving substantially higher and not periphery yields returning to low euro era levels - despite any bailouts. Gold will climax when an idiot at a cocktail party tells you that his grandmother just put all her savings in it (think internet stocks and real estate). Bonds will get killed. Commodities and equities (especially EM) to outperform.
Source:
http://www.federalreserve.gov/releases/h15/data.htm
Now weighted average those rates by debt/gdp and nominal GDP growth and you will see the problem. With 10% nominal gdp growth and 10% debt to gdp you can afford to pay 10%. At 2% nominal GDP growth and 100% debt to GDP, US can barely afford 2%. Spain with REAL debt to GDP of 150%+ and nominal gdp growth of -2% - 6.5% is an exostential threat.
Japan has a Debt/GDP of 220% and grew at an average of 1.00% since 2000. By contrast, Spain is at Debt/GDP of 90% post-bailout and grew at an average 2.2% since 2000 (and yes, I know a lot of it was construction/real estate driven). However, unlike Spain, Japan can borrow at low rates, which obviously is beneficial. I don't care if Spain defaults or not but if you put the numbers on a spreadsheet at today's rates or higher, the Spanish sovereign is not in any danger of imminent default. Again, if you put today's yields in a historical context they are not high. The real danger in Spain is a banking crisis spilling over into other countries, asset markets, etc. I believe this is possible but not guaranteed by any means. Show me the detailed math that says Spain willl default.
http://www.gfmag.com/gdp-data-country-reports/175-spain-gdp-country-repo...
http://www.gfmag.com/gdp-data-country-reports/247-japan-gdp-country-repo...
Pay Reggie, and he'll show you the math, albeit in a tiny, tiny font.
At least the Euro banks arent boycotting Egan. Maybe that's because they didnt downgrade Europes largest banks - tha Vatican and the Mafia
Okay, that's the largest. So... what's the second largest?
It's all fun and games until someone loses their AAA.
I live in Colombia...and yesterday they had 6 heads of corporations in the newspaper saying how Colombia is safe from what is going on in Europe.....now Colombia is the little brother of Spain....and I am thinking to myself....oh oh...here we go again with the denials......this is an export country...who are you going to export to if they are not buying.....but the good news is prices of play will be dropping in Cartagena...lol
Doesn't matter, Europe is ignoring them...right?
I read that as CCCP
If I could be invisible for a day... I can't decide if I'd rather be at Egan Jones (for the laughs) or the Justice Department (for the tears).
Word to the brotherz
We're broke as motherfuckas
When Egan-Jones talks... People listen... Sean Egan has got a set on him, yeah man. I love those guys.
When Egan-Jones talks...
The SEC comes out of a porn induced coma.
It's nice to see something in the USA that works.
what's the problem? C is still passing , ain't it? Spain got a C+. In fact , they got 3 C's . there are some years I would have loved a report card like this.