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Here Comes The S&P Downgrade Barrage - Full Statement, In Which S&P Says France May Get Two Notch Downgrade

Tyler Durden's picture


Standard & Poor's Ratings Services today placed its long-term sovereign ratings on 15 members of the European  Economic and Monetary Union (EMU or eurozone) on CreditWatch with negative implications. 

We have also maintained the CreditWatch negative status of our long-term  rating on Cyprus and placed its short-term ratings on CreditWatch with negative implications. The ratings on Greece have not been placed on  CreditWatch. The ratings on the eurozone sovereigns are listed below.

Today's CreditWatch placements are prompted by our belief that systemic stresses in the eurozone have risen in recent weeks to the extent that they now put downward pressure on the credit standing of the eurozone as a whole.

We believe that these systemic stresses stem from five interrelated factors:

  1. Tightening credit conditions across the eurozone;
  2. Markedly higher risk premiums on a growing number of eurozone sovereigns, including some that are currently rated 'AAA';
  3. Continuing disagreements among European policy makers on how to tackle the immediate market confidence crisis and, longer term, how to ensure greater
  4. economic, financial, and fiscal convergence among eurozone members;(4) High levels of government and household indebtedness across a large area of the eurozone; and
  5. The rising risk of economic recession in the eurozone as a whole in 2012. Currently, we expect output to decline next year in countries such as Spain, Portugal and Greece, but we now assign a 40% probability of a fall in output for the eurozone as a whole.

Our CreditWatch review of eurozone sovereign ratings will focus on three of the five key factors that form the core of our sovereign ratings methodology:

the "political," "external," and "monetary" scores we assign to the governments in the eurozone (see "Sovereign Government Rating Methodology And Assumptions", published June 30, 2011). Our analysis of "political dynamics" will focus on both country-specific and eurozone-wide issues that appear to us to be limiting the effectiveness of efforts to resolve the market confidence crisis. Our analysis of "external liquidity" will focus on the borrowing requirements of both eurozone governments and banks. Our analysis of "monetary flexibility" will focus on ECB policy settings to address the economic and financial stresses the countries in the eurozone are increasingly facing.  

We expect to conclude our review of eurozone sovereign ratings as soon as possible following the EU summit scheduled for Dec. 8 and 9, 2011. Depending on the score changes, if any, that our rating committees agree are appropriate for each sovereign, we believe that ratings could be lowered by up to one  notch for Austria, Belgium, Finland, Germany, Netherlands, and Luxembourg, and by up to two notches for the other governments.  [THIS MEANS FRANCE]

Our ratings on Greece (Hellenic Republic; CC/Negative/C) are not affected by today's actions, as a 'CC' rating under our rating definitions connotes our belief that there is a relatively high near-term probability of default.

We are publishing separate media releases with the rationale for each rating action on the 16 CreditWatch actions. We are also publishing the following article: "Credit FAQ: Factors Behind Our Placement of Eurozone Governments on CreditWatch".

Following today's CreditWatch listings, Standard & Poor's will issue separate media releases concerning affected ratings on the funds, government-related entities, financial institutions, insurance companies, public finance, and structured finance sectors in due course.


RATINGS LIST             To                   From

Long-term ratings on CreditWatch negative

Austria (Republic of) Sovereign Credit Rating  AAA/Watch Neg/A-1+   AAA/Stable/A-1+

Belgium (Kingdom of) Sovereign Credit Rating   AA/Watch Neg/A-1+    AA/Negative/A-1+

Finland (Republic of) Sovereign Credit Rating   AAA/Watch Neg/A-1+   AAA/Stable/A-1+

France (Republic of) Sovereign Credit Rating   AAA/Watch Neg/A-1+   AAA/Stable/A-1+

Germany (Federal Republic of) Sovereign Credit Rating   AAA/Watch Neg/A-1+   AAA/Stable/A-1+

Luxembourg (Grand Duchy of) Sovereign Credit Rating   AAA/Watch Neg/A-1+   AAA/Stable/A-1+

Netherlands (The) (State of) Sovereign Credit Rating   AAA/Watch Neg/A-1+   AAA/Stable/A-1+

Long- and short-term ratings on CreditWatch negative

Estonia (Republic of) Sovereign Credit Rating   AA-/Watch Neg/A-1+   AA-/Stable/A-1+

Ireland (Republic of) Sovereign Credit Rating   BBB+/Watch Neg/A-2   BBB+/Stable/A-2

Italy (Republic of) Sovereign Credit Rating   A/Watch Neg/A-1      A/Negative/A-1 

Malta (Republic of) Sovereign Credit Rating   A/Watch Neg/A-1      A/Stable/A-1

Portugal (Republic of) Sovereign Credit Rating   BBB-/Watch Neg/A-3   BBB-/Negative/A-3

Slovak Republic Sovereign Credit Rating   A+/Watch Neg/A-1     A+/Positive/A-1

Slovenia (Republic of)  Sovereign Credit Rating   AA-/Watch Neg/A-1+   AA-/Stable/A-1+
Spain (Kingdom of)  Sovereign Credit Rating   AA-/Watch Neg/A-1+   AA-/Negative/A-1+

Short-term ratings on CreditWatch negative, long-term ratings still on
CreditWatch negative

Cyprus (Republic of) Sovereign Credit Rating   BBB/Watch Neg/A-3    BBB/Watch Neg/A-3


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Mon, 12/05/2011 - 17:27 | 1948279 Fips_OnTheSpot
Fips_OnTheSpot's picture

Luxembourg? Lolburg.

Mon, 12/05/2011 - 17:33 | 1948310 HedgeAccordingly
HedgeAccordingly's picture

Chicks from europe are the hottest - 

Mon, 12/05/2011 - 17:54 | 1948433 GOSPLAN HERO
GOSPLAN HERO's picture

USA is the land of wideload chicks.

Mon, 12/05/2011 - 17:58 | 1948451 bigdumbnugly
bigdumbnugly's picture

yep.  babe of the day.

unquestionably nailable and her hair remains perfectly coiffed even under water.

Mon, 12/05/2011 - 18:01 | 1948464 Spastica Rex
Spastica Rex's picture

She possesses built-in flotation devices, too. Wow.

Mon, 12/05/2011 - 18:14 | 1948507 bigdumbnugly
bigdumbnugly's picture

almost enough to make even bawney frank go hetero.

Mon, 12/05/2011 - 19:05 | 1948719 sqz
sqz's picture

Well, that must have scuppered a few plans! The EFSF AAA (CDO-like) rating makes it look like a zombie, even before it could be "expanded"!

Tue, 12/06/2011 - 00:44 | 1949788 markmotive
markmotive's picture


Mon, 12/05/2011 - 17:43 | 1948375 achmachat
achmachat's picture

if you downgrade the place with the highest per capita GDP in the world... what are you supposed to do with all the rest????

Mon, 12/05/2011 - 17:59 | 1948457 Johnny B Good
Johnny B Good's picture

Nothing, because its not founded in reality anyway.

Just propaganda Bullshit to misdirect from the fact that the US and UK are bad ass broke.

But dont worry they'll go down the drain soon, not the euro, and their phony minion rating agencies with them.

Really all rating agencies are american, do you honestly believe they will realistically downgrade US ratings ? Dream on.

Small test: You get to make a list of people who get money. First place gets 1000$, Second 500$, Third 250$ etc.

How likely is it that your own Name is on place One ? Exactly.

Mon, 12/05/2011 - 18:35 | 1948591 r101958
r101958's picture

The ratings agencies are now the cattle prod of choice for TPTB to use against countries and pols that will not immediately effect the desired changes or institute the desired policies. Typical carrot and stick psychology. All this in an effort to create one centralized EU government.

Mon, 12/05/2011 - 20:12 | 1948906 Hard1
Hard1's picture

Earth has been just downgraded by the Stellar and Planetary Ratings (S&P), a MRSO (Milky way Recognized Statical Organization) to triple Zed minus outlook negative.  Saturn has outlook positive as the new methodoligy consideres that lack of life is better than lack of intelligent life.

Mon, 12/05/2011 - 21:55 | 1949279 WonderDawg
WonderDawg's picture

You're probably on the right track. The ratings agencies definitely have a less than pure motive for this. Who stands to gain if S&P drops the ratings? What would likely be the reaction and who benefits? If you can figure that out, you can make the right play. I'm just not sure I can accurately anticipate the reaction and how to position myself.

Mon, 12/05/2011 - 17:49 | 1948402 1000pips
1000pips's picture

Already baked in. No big deal. S&P does not matter. Euro/USD to $1.40 in a couple of weeks. Enjoy the holidays with your family. Everything is set up for 2012 to be a HUGE years for the markets. May even set new highs. Trade accordingly.

Mon, 12/05/2011 - 17:57 | 1948447 barliman
barliman's picture



Rahm?  Is that you? Sheeeeeeit ...I almost didn't recognize you without you dropping the F-bomb.

Don't let me distract you from distracting - be cool.


Mon, 12/05/2011 - 18:03 | 1948471 mayhem_korner
mayhem_korner's picture



Is it mandatory for trolls to have the red-white-and-blue, Robo-Hamy?

Mon, 12/05/2011 - 18:18 | 1948522 1000pips
1000pips's picture

Any one who post the truth on this site is called a 'troll', the market has almost doubled in 3 yrs. All this time you chicken little fools have been posting 'the sky is falling'. You must almost be broke now, shorting this market is a suckers move--but hey, maybe you dumb asses like that. Peace on earth, Dow to 15,000 in 2012.

Mon, 12/05/2011 - 18:22 | 1948538 RichardENixon
RichardENixon's picture

If the Dow goes to 15,000 in 2012 it will be about 500 points higher than when stupid fucks like you went all in back in 2007.

Mon, 12/05/2011 - 19:02 | 1948713 Teamtc321
Teamtc321's picture

1000, I suggest you take a look at this interview with Mr. Bass.


Enjoy if you havn't yet viewed the clip. 

Mon, 12/05/2011 - 19:05 | 1948723 cranky-old-geezer
cranky-old-geezer's picture



Your rising Dow came at the expense of debasing the US dollar 1/3 since '08.  You stock bulls never talk about that. 

Mon, 12/05/2011 - 22:56 | 1949486 barliman
barliman's picture


"Any one who post the truth on this site is called a 'troll', the market has almost doubled in 3 yrs."

Troll ... no.

Truth .... usually takes more than a snippy soundbite ... and on ZH your credibility takes time to be established. Spouting "green shoots" propaganda regarding markets, economies and sovereign states is a guaranteed method to demonstrate your ignorance beyond all doubt.

Besides, you'll be much happier getting back to WoW than you will be hanging around here.


P.S. Tyler, much as I hate to say it - can we bring captchas back to weed out the illiterate?

Mon, 12/05/2011 - 18:08 | 1948485 He_Who Carried ...
He_Who Carried The Sun's picture
In Which S&P Says France May Get Two Notch Downgrade  WHICH IN TURN WILL LEAD TO QUICK AND PROMPT DEMISE OF ALL S&P managers, who still need to get a life after failing each and everybody in 1999, and in 2008!
They should be hung by their nostrils! lol
Mon, 12/05/2011 - 17:27 | 1948284 Marcuz Aurelius
Marcuz Aurelius's picture

That was what ? a Half-life of 4 Hours for the Eurocrats ?

Mon, 12/05/2011 - 17:28 | 1948285 GeneMarchbanks
GeneMarchbanks's picture

S&P: We may cut you!

Mon, 12/05/2011 - 17:28 | 1948286 Vlad
Vlad's picture

Belgium should already be cut.

Mon, 12/05/2011 - 17:37 | 1948327 cossack55
cossack55's picture

Belgium gets a minor boost for not having a gubmint.  The US would be back to AAA if we disband our criminal gubmint.

Whats up with the cancelled Czechs?

Mon, 12/05/2011 - 17:52 | 1948404 bank guy in Brussels
bank guy in Brussels's picture

In fact, in Belgium we do now have a government, after 541 days. Our good King of the Belgians, Albert II, has just appointed it after the successful coalition negotiations were completed.

Our new Prime Minister, Elio di Rupo, is quite a good chap. He is of Italian heritage, a gay man, and the leader of the French-speaking Socialist Party in Belgium. He is charming and looks quite dapper in the bow tie he usually wears, but perhaps some Americans will not quite like his profile.

Americans are probably not quite ready for a gay socialist as head of government, but Mr di Rupo is quite all right with us here in Belgium.

Words and meanings: Americans use 'socialism' to mean something like 'fascism', which they greatly suffer, whereas here we use 'liberal' as someone who has strong free-market views.

Too bad Americans have never really experienced government working well, and giving just about every citizen a good life, like we have here. And Americans get sadly distracted from their real enemies, by anti-gay, anti-Muslim, anti-Mexican, and other bigotries.

Mon, 12/05/2011 - 17:55 | 1948440 knukles
knukles's picture

Never fear, Barney Frank's here.

Mon, 12/05/2011 - 18:07 | 1948481 Johnny B Good
Johnny B Good's picture

Who cares ?

Whats the name of the mayor of Washington D.C. ?

Belgium is a neutral ground where the government of the EU is located so that no nation (of importance) can claim to rule europe.

Test it youself:

"Belgium is the ruler of Europe!"

Sounds funny doesn't it ?

As a matter of fact, Belgium was founded in the 19th century as a neutral ground / battlefield for Europes great powers so they don't have to scorche their own land in minor conflicts and have a nice background for parleys.


Mon, 12/05/2011 - 18:23 | 1948516 GoodMorningMr.V...
GoodMorningMr.VanRumpoy...'s picture


Belgium is a case example of the fallacy and failure of the concept of multi -culturalism.

Belgium has largely devolved into two separate nations under one flag,

In the north The Dutch-speaking Flemish Community people of the Flanders region


French-speaking  people of the Walloon region in the south. 

The two different ethnic groups have been feuding and that’s why it took a full 1 year and ½ to form a government.  Even the road signs are written in different language depending on the region.

Most likely the entity known as “Belgium” will   fall apart once they are forced to institute austerity and have to fight over which region takes the biggest hit.


Mon, 12/05/2011 - 17:54 | 1948432 Black Forest
Black Forest's picture

Whats up with the cancelled Czechs?

They have never been part of the eurozone, their currency is CZK.

Mon, 12/05/2011 - 17:53 | 1948426 hugovanderbubble
hugovanderbubble's picture






Just ANTWERP has any potential value as a big harbor....

BELGIUM will be splitted into 3 Yugoslavia...and in a couple years Spain...NEOBALKANIZATION COMING (in belgium and spain...and who knows in more euro FISCAL HARMONIZATION IS AN ODYSSEY...UTOPIA

Mon, 12/05/2011 - 17:28 | 1948287 redpill
redpill's picture

Please keep your hands an arms inside the boat at all times, and enjoy your ride on The Downward Spiral (tm)!


Mon, 12/05/2011 - 17:33 | 1948315 JPM Hater001
JPM Hater001's picture


Mon, 12/05/2011 - 18:03 | 1948348 bigdumbnugly
bigdumbnugly's picture

the final thrill ride for all turds.

Mon, 12/05/2011 - 17:29 | 1948291 SheepDog-One
SheepDog-One's picture

So in other words theyre trying to scare the ECB into printing?

Mon, 12/05/2011 - 17:33 | 1948308 GeneMarchbanks
GeneMarchbanks's picture

Of course. Austerity... was tried. Fail. See Greece.

Nothin' left...


Mon, 12/05/2011 - 17:33 | 1948312 Vincent Vega
Vincent Vega's picture

Perhaps they are just trying to give that apperance, Sheep. Perhaps this is all part of the script to give cover to Fed to print. Who knows any is all so FUBAR.

Mon, 12/05/2011 - 17:36 | 1948340 SheepDog-One
SheepDog-One's picture

I dont know who they have to hide from or fool in order to print....who is there to stop them?

Mon, 12/05/2011 - 17:41 | 1948362 Vincent Vega
Vincent Vega's picture

Good point...I breifly thought Congress but they are impotent.

Mon, 12/05/2011 - 17:50 | 1948387 bigdumbnugly
bigdumbnugly's picture

is that ebonics for important or did you mean utterly useless?

Mon, 12/05/2011 - 17:49 | 1948401 centerline
centerline's picture

It's about placing the blame - redirection.  Politicians take the next hit.  Then people will take the ultimate and final hit.  That should work wonders for divide and conquer as well.  In this case, divide and liquidate.  Public versus private, haves versus have not, political party A against political party B, young versus old, cat owners against dog owners, prego versus ragu, etc.

Mon, 12/05/2011 - 17:48 | 1948398 vote_libertaria...
vote_libertarian_party's picture

That is my question.  What is considered negative?


If they (Euroland) all agree to print a Trillion Euros in funny money and push defaults out 2 years is that good?


If they say no to printing, no more new debt but there are a lot of bond write offs is that good because they would finally be improving the situation (after the write-offs, theoretically)

Mon, 12/05/2011 - 17:29 | 1948292 Matt1973
Matt1973's picture

who cut the cheese ?

Mon, 12/05/2011 - 17:34 | 1948324 JPM Hater001
JPM Hater001's picture

I think it was Nigel Farage.  Well, first smelt first delt?

Mon, 12/05/2011 - 17:36 | 1948331 hugovanderbubble
hugovanderbubble's picture

No Cheese for bad mouse...


AND WHEN UK WILL BE DOWNGRADED???????????????????????????????'

Mon, 12/05/2011 - 17:39 | 1948355 txsilverbug
txsilverbug's picture

This would be that expensive swiss cheese right?  Not that fake ass french cheese..

Mon, 12/05/2011 - 17:53 | 1948431 The 100 Trillio...
The 100 Trillion Dollar Man's picture


Mon, 12/05/2011 - 17:30 | 1948294 txsilverbug
txsilverbug's picture

Who gave S&P their scissors and balls back?

Mon, 12/05/2011 - 17:30 | 1948298 knukles
knukles's picture

Why not save time and just state that "All the European countries who have been recently decribed as fucked will be cut."

Mon, 12/05/2011 - 17:30 | 1948299 SheepDog-One
SheepDog-One's picture

Cuts to already poor pensioners....all time record bonuses for the worthless world bankster pirates.


Mon, 12/05/2011 - 18:35 | 1948594 RichardENixon
RichardENixon's picture

"We see no realistic chance of Hurricane Katrina coming anywhere near the New Orleans Metropolitan Area"--Ben Bernanke Head of National Hurricane Center August, 2005

Mon, 12/05/2011 - 17:31 | 1948301 fonzanoon
fonzanoon's picture

If they cut Estonia the whole thing collapses. France and Germany are one thing. But if Estonia goes...

Mon, 12/05/2011 - 17:34 | 1948322 GeneMarchbanks
GeneMarchbanks's picture

I've always said "Estonia is the fulcrum..."

Mon, 12/05/2011 - 17:43 | 1948372 Iwanttoknow
Iwanttoknow's picture


Mon, 12/05/2011 - 17:58 | 1948452 fonzanoon
fonzanoon's picture

I don't have the time nor the inclination to explain why Estonia is the fulcrum but he is right, it is. I will be up all night dreading Asia's reaction to this news about Estonia. I fear for the safety of Estonian's abroad. May people treat them like human beings and not blame them for Estonia's role in this crisis.

Mon, 12/05/2011 - 19:29 | 1948798 Dave Thomas
Dave Thomas's picture

Epic sax guy is from Estonia. They know how to party!

Mon, 12/05/2011 - 20:59 | 1949055 TheFourthStooge-ing
TheFourthStooge-ing's picture

It's the towels - they're from Estonia.


Mon, 12/05/2011 - 18:00 | 1948434 tekhneek
tekhneek's picture

You trying to outwit yourself?

Mon, 12/05/2011 - 18:02 | 1948468 fonzanoon
fonzanoon's picture

In a showing of respect for Estonian's the world over I will now recite their national anthem...."Estonia, Estonia...we like stones and the letter E! We put these two things together... and forever it shall be!!"

Mon, 12/05/2011 - 18:36 | 1948600 RichardENixon
RichardENixon's picture

Nice beat and you can dance to it. I give it a 50.

Mon, 12/05/2011 - 18:09 | 1948484 falak pema
falak pema's picture

If Estonia is the fulcrum then Lithuania must be fulsome and Latvia crumsome. Now we can make German borsch.

These S&P shills must know how to make fukked up duck soup that even the Marx Brothers would love to eat.

Mon, 12/05/2011 - 17:32 | 1948304 BlueStreet
BlueStreet's picture

So we should probably expect some kind of global coordinated effort to save mankind tomorrow morning. 

Mon, 12/05/2011 - 17:38 | 1948352 Tsar Pointless
Tsar Pointless's picture


I mean, it's been a whole six days since the last one, so we're about due.

Mon, 12/05/2011 - 18:53 | 1948676 Freebird
Freebird's picture

Surely a global counterfeiting effort...

Mon, 12/05/2011 - 20:45 | 1949005 cranky-old-geezer
cranky-old-geezer's picture



Not save mankind, save banks.  It's all about saving banks (and bonuses) now.  Has been since '08. 

Mon, 12/05/2011 - 17:34 | 1948318 Tuffmug
Tuffmug's picture

As we remain deep in the rabbit hole, I suspect S&P also issued a STRONG BUY rating on every country they said they may CUT.

Mon, 12/05/2011 - 17:34 | 1948321 hugovanderbubble
hugovanderbubble's picture

Vatican City : Downgraded to Junk - Banca Ambrosiana II Part.










Mon, 12/05/2011 - 17:43 | 1948353 The Swedish Chef
The Swedish Chef's picture

No, please let them continue to sink those separatists assholes in to the ground. Everything that makes the neonazionals of the different Spanish regions turn to Madrid is good.


Que no son españoles, son hijos de puta!

Mon, 12/05/2011 - 17:50 | 1948409 hugovanderbubble
hugovanderbubble's picture

The problem of spain are the corruption and the ultraleverage of all Comunidades Autonomas.





Are all in default


In few years Spain will be a new balkans but in Iberia....hope not a war involved....but for disgrace,,,this country will not continue as a unity...." TOO MANY CONFLICT of INTERESTS"

Catalonia wants the independence

Vasque Country too...


I agree with them, its better to break down the Unity and stablish new system-government.... the current doestn works...SPECIALLY COS CORRUPTION.


So Tough times coming inside Spain for 2-3 years... Difficult task for new government, i think honestly they cannot sustain this country cos revolts,riots and strikes will collapse any kind of" recovery". Spain is collapsed

Mon, 12/05/2011 - 17:51 | 1948416 goldenrod
goldenrod's picture

I sent this Spanish sentence via SMS to 1-408-357-4840 and got the following English translation back in seconds on my phone:

Who are not Spanish are bastards!


Mon, 12/05/2011 - 17:54 | 1948435 The Swedish Chef
The Swedish Chef's picture

Literal translation: "They are not Spaniards, they are sons of whores" 

Mon, 12/05/2011 - 18:04 | 1948473 tekhneek
tekhneek's picture

I'd gladly get downgraded if it meant a few hours with that avatar of yours...

Mon, 12/05/2011 - 19:19 | 1948771 Teamtc321
Teamtc321's picture

Is she trying to get a cookie?

Mon, 12/05/2011 - 19:34 | 1948810 Dave Thomas
Dave Thomas's picture

I think she lost her car keys.


Mon, 12/05/2011 - 18:19 | 1948526 richard in norway
richard in norway's picture

better translation is "they are not spaniards, they are english"



Mon, 12/05/2011 - 18:22 | 1948537 richard in norway
richard in norway's picture

spainish nickname for the english is sons of the great whore. dont know why but it seems every nation has a nasty nickname for us apart from norway

Mon, 12/05/2011 - 17:34 | 1948323 YesWeKahn
YesWeKahn's picture

Italy "republic", LOL

Mon, 12/05/2011 - 17:53 | 1948428 knukles
knukles's picture

California Republic.
Don't laugh, it's part of the Good Olde U S of A.

Mon, 12/05/2011 - 17:34 | 1948325 Racer
Racer's picture

In other words going on previous timeliness of CRA's those gummints have exploDEADed already

Mon, 12/05/2011 - 17:34 | 1948326 bingo was his name
bingo was his name's picture

Meanwhile back at the ranch

Rosanne Barr is learning the words to Italian national athem

and Uncle Ben is figuring out which helicopter to travel the world in 


Mon, 12/05/2011 - 17:36 | 1948339 Racer
Racer's picture

I think he needs to do a Matrix version of himself..... to end up the same way!

Mon, 12/05/2011 - 17:35 | 1948330 The Swedish Chef
The Swedish Chef's picture

"Continuing disagreements among European policy makers on how to tackle the immediate market confidence crisis and, longer term, how to ensure greater  economic, financial, and fiscal convergence among eurozone members"


Oh, I´m so fucking sorry, I didn´t realize the Fourth Reich was a neccessity to avoid a downgrade. We´ll fix that right quick in a hurry for you. Heil Merkel! Hey, that has a nice ring to it....

Mon, 12/05/2011 - 17:56 | 1948443 hugovanderbubble
hugovanderbubble's picture

FIscal Convergence is an utopia.

European Countries has lost the game.


Now we have to pay for the mistakes we have made.


Mon, 12/05/2011 - 17:35 | 1948332 TradingJoe
TradingJoe's picture

Nah! It's "stable" so...rally on folks! DeMark just gave the TA bazooka, 1330-1340 by Dec 21st, right in time for Santa, eh?!

Mon, 12/05/2011 - 17:35 | 1948334 Hondo
Hondo's picture

Anyone with an Debt/Equity ratio over 65% is to be deemed a systemic risk in which all equity must be wiped out and any debt become what ever equity is left.....

Mon, 12/05/2011 - 17:35 | 1948335 Pancho Villa
Pancho Villa's picture

Italy, Spain still have A ratings. What a joke!

Mon, 12/05/2011 - 17:38 | 1948350 navy62802
navy62802's picture

... until they're not.

Mon, 12/05/2011 - 17:43 | 1948371 SheepDog-One
SheepDog-One's picture

Yea whats really the point? Ratings seem to mean a hill of damn beans....everyone 'downgraded' but nothing is really effected by it.

Mon, 12/05/2011 - 17:51 | 1948421 knukles
knukles's picture

Not true...
Collateral postings, margins as they apply to swaps, etc. are directly impacted by ratings whether warrnated or not.  
Could have some large dislocations amongst private participants/counterparties

Mon, 12/05/2011 - 17:35 | 1948336 txsilverbug
txsilverbug's picture

Long on scissors biatches!

Mon, 12/05/2011 - 17:35 | 1948338 azzhatter
azzhatter's picture

Slovakia has like a 23% debt/GDP , Netherlands is like 64% Debt/GDP


Mon, 12/05/2011 - 17:36 | 1948341 ZeroPower
ZeroPower's picture

Currently, we expect output to decline next year in countries such as Spain, 
Portugal and Greece,

Output decline? Oh no, time to stock up on.... i have no idea, cause nothing I buy is from there. Ill just write Ouzo to save them the humility.

Mon, 12/05/2011 - 17:37 | 1948347 SheepDog-One
SheepDog-One's picture

'Spanish rice' and Ouzo? I dont know...

Mon, 12/05/2011 - 17:41 | 1948359 The Swedish Chef
The Swedish Chef's picture

Don´t know about the other PIIGS but Spain does supply a lot of agricultural produce to the rest of Europe nad they actually build cars too.

Mon, 12/05/2011 - 17:48 | 1948399 knukles
knukles's picture


Mon, 12/05/2011 - 17:50 | 1948410 The Swedish Chef
The Swedish Chef's picture

And that is the peice of information that fills the previous posters lack of knowledege. Now fuck off.

Mon, 12/05/2011 - 17:59 | 1948453 knukles
knukles's picture


That's like my wife telling me to keep the garbage cans about 1' to the left for whatever the fucking reason I cannot fathom.

Thank you.
(face in palms)

Mon, 12/05/2011 - 18:32 | 1948582 ZeroPower
ZeroPower's picture

DOnt like the produce answer. Every country has its own farmers, just depends on the consumer willing to buy stuff flown in or local/organic things.

Right on about Sey-ats though. Didnt know they still make those.

Mon, 12/05/2011 - 17:36 | 1948343 Tsar Pointless
Tsar Pointless's picture

Sure. Now it's time to cut sovereign credit ratings, because the proles need to be bailed out after socializing losses for those who gained privately.

Oh, well. That's fascism for ya!

Oh - and for me, too.

Mon, 12/05/2011 - 17:36 | 1948344 A Man without Q...
A Man without Qualities's picture

I think the easiest way to make money in this market is to wait for any announcement from Sarkozy of a grand plan to fix everything, wait for the little bump and then get very short.  It's been working nicely for me....

Mon, 12/05/2011 - 17:38 | 1948351 txsilverbug
txsilverbug's picture

markets go up on the lie and back down on the truth.  Your method works fine.  Wait for the lie, and then buy truth.

Mon, 12/05/2011 - 17:50 | 1948411 A Man without Q...
A Man without Qualities's picture

The fact of the matter is that the French were so happy to embrace the Euro project because they saw it as a perfect way for them to get Germany to fund their bloated welfare state economy.  I used to amuse myself by trying to dig deeper into the economic data produced by the French government, and the glaringly obvious fact was it was bullshit.  The funny thing was I have never come across a banker or economist who genuinely believes the French GDP numbers (apart from some French ones who just get angry that you dare question the glory of France.)  I think it started with de Gaulle's obsession with getting the GDP above the UK, and it's just carried on.  There's all sorts of horror stories hidden in the state owned entities like SNCF and RFF which owns the actual rail network, and never mind all the regions and municipalities.

Anyway, Sarkozy's clearly desperate to get to the point were Merkel agrees to cross guarantee debts, he will promise to stick to the fiscal rules (but will make sure there are still the usual loopholes, eg derivatives, no independent verification of data) and then they can carry on living the easy life for a while longer.

Mon, 12/05/2011 - 21:00 | 1949062 cranky-old-geezer
cranky-old-geezer's picture



The fact of the matter is that the French were so happy to embrace the Euro project because they saw it as a perfect way for them to get Germany to fund their bloated welfare state economy

And Germany joined the Euro project to eventually get sovereign authority over France (and the rest of Europe) without firing a shot.

Mon, 12/05/2011 - 17:36 | 1948345 TruthInSunshine
TruthInSunshine's picture

Atlantis = BBB-

Ambrosia = C+

Hopiumbria = DDD

Mon, 12/05/2011 - 17:47 | 1948388 end da fed
end da fed's picture

Narnia= AA-

Naboo= BBB+

Mon, 12/05/2011 - 17:51 | 1948419 BlackSunshine
BlackSunshine's picture


Wife DDD-

Kids FFF

Mon, 12/05/2011 - 17:37 | 1948346 JJSF
JJSF's picture

Hearing S&P may lower France two notches

Mon, 12/05/2011 - 17:42 | 1948365 lizzy36
lizzy36's picture


and by up to two notches for the other governments.  [THIS MEANS FRANCE]

Mon, 12/05/2011 - 22:07 | 1949321 WonderDawg
WonderDawg's picture

So you did read the headline.

Mon, 12/05/2011 - 17:40 | 1948356 pkea
pkea's picture

I would wait to get quad short until march 2012

Mon, 12/05/2011 - 17:40 | 1948357 lizzy36
lizzy36's picture

Nice Monday Massacre.

Now what will be this Wednesday's Coordinated action response?

Also RIP EFSF....Too bad about the 12% the dealers had to keep on books after last EUR3B bond. Couldn't have happened to a nicer bunch of Banks..

Mon, 12/05/2011 - 17:40 | 1948358 SheepDog-One
SheepDog-One's picture

So whats it all mean, man?

This translates into the equity market futures being up by another 1.5% again tomorrow morning?

Somethings wrong with this whole picture, we've been on the edge of implosion for the last 12 months at least, but for whatever reason theres always a stick save today, and good news for tomorrow.

Everyone can see the wheels are going to fly off, but its never today, and not tomorrow either. Some Groundhog Day nonsense we're in.

Mon, 12/05/2011 - 17:48 | 1948396 txsilverbug
txsilverbug's picture

I wouldn't say everyone.. Maybe everyone if a commercial ran during DWTS but I cant see everyone putting any interest in whats going on over there, they just don't understand it.  Most people have the "government will take care of it" attitude with no real understanding that the governments here and over in Europe are the problem. Beans and bullets for me.

Mon, 12/05/2011 - 22:10 | 1949332 WonderDawg
WonderDawg's picture


I talk to friends and associates, ask them if they've been watching what's going on in Europe. "Not really", is the typical response.

Mon, 12/05/2011 - 17:41 | 1948360 Sophist Economicus
Sophist Economicus's picture

Won't do a thing -- Market isn't going down yet -- we have more meetings and short covering to go through...Shorting this baby will be one hell of a gamble in the short run

Mon, 12/05/2011 - 17:46 | 1948383 SheepDog-One
SheepDog-One's picture

Ok so when will the meetings be over? We've been doing this shit for a year, 3 years really. And are the shorts actually this stupid? I dont think its shorts in the markets fueling short squeeze rallies, I think its the FED providing short interest with free taxpayer money.

Mon, 12/05/2011 - 17:42 | 1948364 Caviar Emptor
Caviar Emptor's picture

US rated more corrupt than Italy or Ghana

The Corruption Perceptions Index ranks countries/territories based on how corrupt their public sector is perceived to be.

Mon, 12/05/2011 - 17:47 | 1948393 There is No Spoon
There is No Spoon's picture

not according to the link you provided

Mon, 12/05/2011 - 18:33 | 1948586 Caviar Emptor
Caviar Emptor's picture

Check again. US #23 in the world 

Mon, 12/05/2011 - 18:55 | 1948682 There is No Spoon
There is No Spoon's picture

Italy and Ghana tied for #69 in the world with scores of 3.9 vs. U.S. score of 7.1

Mon, 12/05/2011 - 17:42 | 1948368 GOSPLAN HERO
GOSPLAN HERO's picture

California (Kingdom of) BBB-

Mon, 12/05/2011 - 17:52 | 1948424 kaiserhoff
kaiserhoff's picture

People's Republic of Santa Monica   F-

Mon, 12/05/2011 - 17:46 | 1948380 knukles
knukles's picture

An to zeees ze French say: "Why ze fook ees zee Engleesh not on ze leest?  Zees ess totallleee unacksepteeball.  Sillie.  Yes, zat ees sillie.  Phtttt."
And Mr. Sarkozy redacts his comment about not letting Angie show them her penis which is bigger than his penis, worrying that Angie just might show her penis.
And Angie says, "Vat!?! Sarko, you little shiessekpoff.  Vhen I get my hands upon you, I shall poke you mit mine peniscular monstrosiare een ze end of your Matterhorn until you squeal like zee piggies."

Schadenfreude, Bitches
For all the fucking pissing and bitching and moaning the Europeans did after Lehman 1.0, about how they were all pure and innocent like nautral floral spectacles blooming upon heaven's gate, gentle to the touch, blessed by the higher power of useless political promulgation, obfuscation and irritation, never to be the source of troubles or pain.
Fuck you, very much.
Karma Lives

Mon, 12/05/2011 - 17:45 | 1948381 Carlyle Groupie
Carlyle Groupie's picture

Sooooo. Now we all believe the rating agencies?

Which is it?

Or maybe I figured it out. We believe then disbelieve based on the Chinese Calendar. This year, The year of the Squid!

Believe Bitchez!

Mon, 12/05/2011 - 17:47 | 1948390 SheepDog-One
SheepDog-One's picture

No I dont believe the rating agencies because all of these countries, and the U.S., should have a rating of C- at best, if ratings actually meant a damn thing.

Mon, 12/05/2011 - 17:56 | 1948441 Carlyle Groupie
Carlyle Groupie's picture

I'm with you SD#1.

Tyler could have saved a lot of typing by just consulting with you. You're a power Tweeter, I can tell.

Mon, 12/05/2011 - 17:46 | 1948382 Elwood P Suggins
Elwood P Suggins's picture

Hope one of the perks S&P employees have is a good bodyguard. 

Mon, 12/05/2011 - 17:49 | 1948405 txsilverbug
txsilverbug's picture

Another perk is that the S&P analysts get to go work for the companies they rated...

Mon, 12/05/2011 - 17:47 | 1948391 Schmuck Raker
Schmuck Raker's picture

And the next Fed séance is when?

Mon, 12/05/2011 - 17:48 | 1948392 ForWhomTheTollBuilds
ForWhomTheTollBuilds's picture

Because I know nothing of the world and its ways, let me ask:


Is S&P trying to get themselves banned from rating Eurozone govts?  This has been threatened by the beaurocrats before.  Maybe if the S&P forces their hand by screaming, "we are about to downgrade you!!!", they will be banned and the ratings won't fall during the time the S&P is legally operating in Europe. 


That way, everyone can escape (political) blame for whats to come?

Mon, 12/05/2011 - 17:48 | 1948394 yogibear
yogibear's picture

Super socialist France should be downgraded to garbage. Socialism works great until you run out of other people's money.

Mon, 12/05/2011 - 17:51 | 1948415 txsilverbug
txsilverbug's picture

Or inflating your way out of debt with the 'not a single fuck was given' attitude.

Mon, 12/05/2011 - 17:51 | 1948414 JustObserving
JustObserving's picture

The US prints trillions and fudges its data (unemployment, GDP, CPI etc) and has a debt and unfunded liabiliities growth of $23.84 billion a day.  Europe tries to prevent printing and everyday their debt is attacked and sovereign ratings are under threat of being downgraded. In a bizzaro world, the US dollar becomes the fount of value and safety.

Don't be honest in a dishonest world, Europe - fire up the printing presses and your bonds will be worth much more since there will be no more default risk. An insane world requires insane actions.

Mon, 12/05/2011 - 17:52 | 1948423 magpie
Mon, 12/05/2011 - 17:53 | 1948427 Sweet Chicken
Sweet Chicken's picture

There's no earthly way of knowing
Which direction we are going
There's no knowing where we're rowing
Or which way the river's flowing

Is it raining, is it snowing
Is a hurricane a-blowing

Not a speck of light is showing
So the danger must be growing
Are the fires of Hell a-glowing
Is the grisly reaper mowing

Yes, the danger must be growing
For the rowers keep on rowing
And they're certainly not showing
Any signs that they are slowing

Mon, 12/05/2011 - 17:53 | 1948430 Nothing real here
Nothing real here's picture

We got a 490 point rally after S&P downgraded the banks in after hours last Wednesday.  Wouldn't this prospective downgrade warrant an all-time positive move on the Dow?



Mon, 12/05/2011 - 18:02 | 1948465 Carlyle Groupie
Carlyle Groupie's picture

Cyprus got hit and that's where most of the black money is hidden. That tends to get the PtB nervous. That and the Seychelles. Downgrade that bish and S&P will fall like a rock.

Mon, 12/05/2011 - 17:55 | 1948437 Widowmaker
Widowmaker's picture

ZH loses credibility by asserting any sort of cred of the ratings agencies.

...Bullshit & P Inc.

"No one sees it coming."

Mon, 12/05/2011 - 18:00 | 1948460 The 100 Trillio...
The 100 Trillion Dollar Man's picture

This is all just a headfake to downgrade France by one notch. Later this month that's all that will happen.

Mon, 12/05/2011 - 18:00 | 1948462 mayhem_korner
mayhem_korner's picture



'mazing how many words these guys need to use to try to tip-toe around the obvious.  And then a bunch of others will wake up tomorrow, caffeine-up, and write bunches of other words to describe the market's interpretation of S&P's words.

It's the "maybe we can save him...he's just a little dead" delusion.

Mon, 12/05/2011 - 18:02 | 1948466 I am Jobe
I am Jobe's picture

For something completely  different- Tyler something to joke about

 Putting the Interests of the American People Ahead of Politics

Mon, 12/05/2011 - 18:07 | 1948480 I am Jobe
I am Jobe's picture

I think there are a few more countries to be added.

Mon, 12/05/2011 - 18:07 | 1948482 Elwood P Suggins
Elwood P Suggins's picture

S&P to the Euro Zone:


Leverage This!

Mon, 12/05/2011 - 18:07 | 1948483 yogibear
yogibear's picture

One problem with inflating is that commodity cost ram you real hard.  No wage power. Far better for the banksters to take their bad bets than socializing the losses.

Mon, 12/05/2011 - 18:12 | 1948494 Mister Ponzi
Mister Ponzi's picture

S&P going nuclear... This is huge. A lot of real money accounts in Europe (insurers, pension funds, etc.) have very strict investment guidelines. A collective loss of AAA ratings will be a big problem. Also: Italy may be cut two notches to BBB+. In the BBB sphere, many investors will have to reduce exposure significantly or change guidelines (tough task!). A cut outlined by S&P will have an immense impact on Europe's investement landscape.

Mon, 12/05/2011 - 18:13 | 1948499 Mr.Kowalski
Mr.Kowalski's picture

Lets give Bernanke credit this week for a stick save of the European banking system anyways. Given the ugly opposition Coburn displayed on Friday and the political cost to Obama when it gets out that we're possibly bailing out Italy, some are saying that Bernanke's artillery has run out of shells. I say never underestimate a desperate banker's willingness to print money and bypass the laws of the land. It's a weird irony that the ECB, which does follow their laws, is being bailed out by a central bank that shamefully obeys no one.

Mon, 12/05/2011 - 18:18 | 1948514 Curtis LeMay
Curtis LeMay's picture

It's about damn time the rating agencies got on the ball-they fell asleep in '07 and '08...

S&P is also stating the fucking obvious. Which sovereign wealth fund manager or some bond heavyweight woukd even consider buying now euro-junk-bonds? In fact, the money has been running away from euro-junk-bonds for months now as it is...

Mon, 12/05/2011 - 18:28 | 1948562 slewie the pi-rat
slewie the pi-rat's picture



"And a very Merry Christmas to you, Mr. Scrooge!"

lotsa stuff, here for stuffing stockings...germAAAny? ...hmmm...

well, ...they have been advised!

are they still doing that thing where nobody wants to be "it", meaning the person whose decision ends the happy however-many nations' attempt at driving everyone batshit?   L0L!!!



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