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  1. #1
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    France loses AAA-rating in blow to eurozone

    France loses AAA-rating in blow to eurozone - Yahoo! Finance

    PARIS (AP) -- France's finance ministry says Standard & Poor's has cut the country's credit rating by one notch to AA.
    France's loss of its AAA-rating deals a heavy blow to the eurozone's ability to fight off its debt crisis. The country is the second-largest contributor to the currency union's bailout fund.
    S&P in December put 15 eurozone countries on creditwatch and other downgrades were expected later Friday.
    The cut in France's creditworthiness could also hurt President Nicolas Sarkozy's re-election chances.
    ROME (AP) -- Europe's ability to fight off its debt crisis was again thrown into doubt Friday when the euro hit its lowest level in over a year and borrowing costs rose on expectations that the debt of several countries would be downgraded by rating agency Standard & Poor's.
    Stock markets in Europe and the U.S. plunged late Friday when reports of an imminent downgrade first appeared and the euro fell to a 17-month low.
    The fears of a downgrade brought a sour end to a mildly encouraging week for Europe's heavily indebted nations and were a stark reminder that the 17-country eurozone's debt crisis is far from over.
    Earlier Friday, Italy had capped a strong week for government debt auctions, seeing its borrowing costs drop for a second day in a row as it successfully raised as much as euro4.75 billion ($6.05 billion). Spain and Italy completed successful bond auctions on Thursday, and European Central Bank president Mario Draghi noted "tentative signs of stabilization" in the region's economy.
    A credit downgrade would escalate the threats to Europe's fragile financial system, as the costs at which the affected countries — some of which are already struggling with heavy debt loads and low growth — could borrow money would be driven even higher.
    The downgrade could drive up the cost of European government debt as investors demand more compensation for holding bonds deemed to be riskier than they had been. Higher borrowing costs would put more financial pressure on countries already contending with heavy debt burdens.
    In Greece, negotiations Friday to get investors to take a voluntary cut on their Greek bond holdings appeared close to collapse, raising the specter of a potentially disastrous default by the country that kicked off Europe's financial troubles more than two years ago.
    The deal, known as the Private Sector Involvement, aims to reduce Greece's debt by euro100 billion ($127.8 billion) by swapping private creditors' bonds with new ones with a lower value, and is a key part of a euro130 billion ($166 billion) international bailout. Without it, the country could suffer a catastrophic bankruptcy that would send shock waves through the global economy.
    Prime Minister Lucas Papademos and Finance Minister Evangelos Venizelos met on Thursday and Friday with representatives of the Institute of International Finance, a global body representing the private bondholders. Finance ministry officials from the eurozone also met in Brussels Thursday night.
    "Unfortunately, despite the efforts of Greece's leadership, the proposal put forward ... which involves an unprecedented 50 percent nominal reduction of Greece's sovereign bonds in private investors' hands and up to euro100 billion of debt forgiveness — has not produced a constructive consolidated response by all parties, consistent with a voluntary exchange of Greek sovereign debt," the IIF said in a statement.
    "Under the circumstances, discussions with Greece and the official sector are paused for reflection on the benefits of a voluntary approach," it said.
    Friday's Italian auction saw investors demanding an interest rate of 4.83 percent to lend Italy three-year money, down from an average rate of 5.62 percent in the previous auction and far lower than the 7.89 percent in November, when the country's financial crisis was most acute.
    While Italy paid a slightly higher rate for bonds maturing in 2018, which were also sold in Friday's auction, demand was between 1.2 percent and 2.2 percent higher than what was on offer.
    The results were not as strong as those of bond auctions the previous day, when Italy raised euro12 billion ($15 billion) and Spain saw huge demand for its own debt sale.
    "Overall, it underscores that while all the auctions in the eurozone have been battle victories, the war is a long way from being resolved (either way)," said Marc Ostwald, strategist at Monument Securities. "These euro area auctions will continue to present themselves as market risk events for a very protracted period."
    Italy's euro1.9 trillion ($2.42 trillion) in government debt and heavy borrowing needs this year have made it a focal point of the European debt crisis.
    Italy has passed austerity measures and is on a structural reform course that Premier Mario Monti claims should bring down Italy's high bond yields, which he says are no longer warranted.
    Analysts have said the successful recent bond auctions were at least in part the work of the ECB, which has inundated banks with cheap loans, giving them ready cash that at least some appear to be using to buy higher-yielding short-term government bonds.
    Some 523 banks took euro489 billion in credit for up to three years at a current interest cost of 1 percent.

  2. #2
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    doesn't look good,

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    Quote Originally Posted by Butterfly
    doesn't look good
    Who cares about what Standard and Poors say?

    They were the ones giving AAA ratings to securitized mortgages between 2004 and 2008 that caused all this mess, and now we are supposed to take anything they say or do seriously?

    Give be a break, another bunch of retards. Fuck S&P, and fuck Fitch and Moody's also.
    Originally Posted by Smeg
    ... I like to fantasise sometimes, and I lie very occasionally... my superior home, job, wealth, freedom, car, girl, retirement age, appearance, satisfaction with birth country etc etc... Over the past few years I have put together over 100 pages on notes on thaiophilia...

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    Debt crisis: Eurozone back on the brink as France has credit rating downgraded

    The eurozone crisis entered a dangerous new phase as France and eight other European countries had their credit ratings downgraded.

    The Treasury believes that the collapse of the euro could push the UK back into a deep recession Photo: REUTERS



    By James Kirkup

    10:02PM GMT 13 Jan 2012


    Stock markets and the single currency fell sharply as Standard and Poor’s cut France’s AAA rating.

    Italy saw its long-term rating drop by two notches, along with Spain, Portugal and Cyprus. Austria, Malta, Slovakia, and Slovenia had their ratings lowered by one notch.

    The move triggered a backlash from European politicians and led to calls for Britain to be downgraded too.

    It represents a further loss of confidence in the single currency and the European Union’s ability to rescue indebted eurozone members. The Treasury believes that any collapse of the euro could seriously damage the British economy and banking system, pushing the UK back into a deep recession.

    The agency’s move also threatens to torpedo the main European bail-out fund set up to support struggling countries such as Greece and Portugal.

    There are growing fears that Greece, which was not reassessed, is edging closer to defaulting on its debts and being forced out of the single currency. Talks between the country and its creditors were put on hold.

    There was no change for Germany, the Netherlands, Ireland, Belgium, Estonia, Finland or Luxembourg.
    The blow to France is the most significant. It has held a AAA rating since 1975. As well as hurting national pride, the lower rating will inevitably mean the country faces higher borrowing costs. It will also affect the eurozone bail-out fund, which is at the heart of efforts to ease fears about the currency bloc, as France is partly responsible for underwriting it.
    Those worries pushed the single currency to its lowest value against the US dollar since mid-2010. The euro also fell against the pound to 82.9 pence.
    European stock markets closed before the downgrades were confirmed, but rumours saw shares fall across the continent. Bigger falls are likely on Monday when markets reopen. The FTSE-100 index also fell on concerns about the possible impact on Britain, closing down 0.5 per cent at 5636.
    François Baroin, the French finance minister, confirmed that France was being downgraded from AAA to AA+. It was “not a catastrophe”, he said. But it is a heavy blow to Nicolas Sarkozy, the French president, who faces re-election in May.
    He and his European allies have publicly attacked the international ratings agencies, accusing them of seeking to undermine the eurozone.
    French officials have said that Britain is more deserving of a downgrade than France. A senior German politician joined their calls on Friday night. Michael Fuchs, a member of the governing Christian Democrats, said that Standard and Poor’s was “playing politics”.
    “If the agency downgrades France, it should also downgrade Britain in order to be consistent,” he said. Wolfgang Schaeuble, the German finance minister, played down the downgrades. “We should not overestimate the ratings agencies in their assessments” he said.
    Despite the gloom, some economists were relieved that stronger eurozone economies were spared by the agency, which last year downgraded the US amid concerns about its deficit.
    After the downgrading of France and Austria, only 12 EU countries retain AAA ratings from Standard and Poor’s.
    Britain is one, and is now likely to see a further fall in the Government’s borrowing costs as investors seek the security of British bonds. The Government refused to comment, but insiders reported a mood of “grim satisfaction” that its deficit-cutting strategy meant there was no real threat of a downgrade.
    Italy’s downgrade, to BBB+, will raise doubts about its ability to sustain a huge national debt in the weeks ahead.
    Eurozone governments led by Italy and Spain are due to sell more than €200  billion of bonds over the next three months. Italy is already paying almost 7 per cent, the level generally agreed to be unsustainable. If investors refuse to buy all its bonds, Rome would be forced to seek a bail-out far bigger than any given to the smaller eurozone nations.
    It would almost certainly have to be led by the International Monetary Fund or the European Central Bank, which has so far refused to give such direct support.
    According to Fitch, another ratings agency, the French downgrade will reduce the €440 billion lending capacity of the European Financial Stability Fund, the euro bail-out mechanism, to €293 billion. It has already committed around €250 billion to Greece, Ireland and Portugal.


    Debt crisis: Eurozone back on the brink as France has credit rating downgraded - Telegraph

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    Quote Originally Posted by Bangyai View Post

    The move triggered a backlash from European politicians and led to calls for Britain to be downgraded too.
    If this were Thailand there would be a picture of all the scowling European leaders pointing their fingers at England sitting comfortably on a chair the other side of the channel.

  6. #6
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    Quote Originally Posted by Bangyai
    Italy’s downgrade, to BBB+, will raise doubts about its ability to sustain a huge national debt in the weeks ahead.
    Italy plan to sell a lot of debt at the end of January, at BBB+, this is going to be expensive and difficult for them. Should be interesting.......

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    Quote Originally Posted by Bangyai View Post
    Quote Originally Posted by Bangyai View Post

    The move triggered a backlash from European politicians and led to calls for Britain to be downgraded too.
    If this were Thailand there would be a picture of all the scowling European leaders pointing their fingers at England sitting comfortably on a chair the other side of the channel.
    Don't be so smug, you have much higher debt than the French.

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    Quote Originally Posted by Begbie View Post
    Quote Originally Posted by Bangyai View Post
    Quote Originally Posted by Bangyai View Post

    The move triggered a backlash from European politicians and led to calls for Britain to be downgraded too.
    If this were Thailand there would be a picture of all the scowling European leaders pointing their fingers at England sitting comfortably on a chair the other side of the channel.
    Don't be so smug, you have much higher debt than the French.
    But a much more trustworthy reputation.


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    Quote Originally Posted by Begbie View Post
    Quote Originally Posted by Bangyai View Post
    Quote Originally Posted by Bangyai View Post

    The move triggered a backlash from European politicians and led to calls for Britain to be downgraded too.
    If this were Thailand there would be a picture of all the scowling European leaders pointing their fingers at England sitting comfortably on a chair the other side of the channel.
    Don't be so smug, you have much higher debt than the French.
    Having one's own currency is a big help in these situations. Otherwise you must do vat ze Chehmans say!
    “You can lead a horticulture but you can’t make her think.” Dorothy Parker

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    Ha, France downgraded with Estonia, Cyprus, Malta, Slovenia, etc.

    They're in good company then.


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    Quote Originally Posted by Spin View Post
    Quote Originally Posted by Butterfly
    doesn't look good
    Who cares about what Standard and Poors say?

    They were the ones giving AAA ratings to securitized mortgages between 2004 and 2008 that caused all this mess, and now we are supposed to take anything they say or do seriously?

    Give be a break, another bunch of retards. Fuck S&P, and fuck Fitch and Moody's also.
    I care and the market cares. I know europeans/EU commission etc who are downgraded blame all their problems to rating agencies. Think logically.

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    I do not know what you know of world of finance. UK is a reliable and always pays back. That matters to everyone lending money. Amount of debt is not important (and in UK debt figures include City financial sector short term loans outside which will eventually come back). As the situation is this, UK is AAA with only few other european countries.

    What Eurotrash- strike that- Euro politicians want is to take UK down with them. Get the UK to eurobond treaty where in the end UK and northern europe would pay for southern europe, monthly, until end of time.

    Good luck for Cameron!



    Quote Originally Posted by Begbie View Post
    Quote Originally Posted by Bangyai View Post
    Quote Originally Posted by Bangyai View Post

    The move triggered a backlash from European politicians and led to calls for Britain to be downgraded too.
    If this were Thailand there would be a picture of all the scowling European leaders pointing their fingers at England sitting comfortably on a chair the other side of the channel.
    Don't be so smug, you have much higher debt than the French.

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    Hate to be smug but


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    Standard and Poor's has decided to downgrade Italy's credit rating by two notches to BBB+ from A, Italian news agency ANSA has reported citing government sources.

    snip

    The move puts Italy on the same Standard & Poor's grading for long-term debt as Kazakhstan, South Africa and Thailand

    S&P downgrades Italy rating - Indian Express

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    Quote Originally Posted by Mid
    Kazakhstan, South Africa
    technically rich countries though,

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    Quote Originally Posted by Butterfly
    technically rich
    define ?

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    full of natural resources, and a rich middle class

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    Quote Originally Posted by Spin
    another bunch of retards. Fuck S&P, and fuck Fitch and Moody's also.
    Agreed.

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    Uploaded by RussiaToday on Jan 13, 2012
    France's prized triple-A credit rating could be about to be cut, according to a senior Eurozone source. The speculation that Standard and Poor's might downgrade the country's status has sent world markets plunging - after an optimistic start to the year. Patrick Young, from investment firm DV Advisors, says that the downgrade has been a long time coming, and is disastrous news for the Euro...

  21. #21
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    The whole of yurp with the exception of the bosch should be at BB+........junk rated.

    Anybody who would like to try to and convince me of otherwise is welcome!

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    The only rational thing here... is to fuck the euro. I know butters will cry and Tintin will not help him, but this is the world now. EUR/USD minute ago was 1.26616.

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    Quote Originally Posted by HansuMan View Post

    Uploaded by RussiaToday on Jan 13, 2012
    France's prized triple-A credit rating could be about to be cut, according to a senior Eurozone source. The speculation that Standard and Poor's might downgrade the country's status has sent world markets plunging - after an optimistic start to the year. Patrick Young, from investment firm DV Advisors, says that the downgrade has been a long time coming, and is disastrous news for the Euro...
    Yes, it was known for long time France would be downgraded - due to its financial failures.

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    Quote Originally Posted by Begbie
    Don't be so smug, you have much higher debt than the French.
    Yes it's as well England owns Scotland or you sweaty's would be totally fucked.

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    Quote Originally Posted by Stinky View Post
    Quote Originally Posted by Begbie
    Don't be so smug, you have much higher debt than the French.
    Yes it's as well England owns Scotland or you sweaty's would be totally fucked.
    The British government might consider selling Scotland to the Japanese, it would make a swell theme park.

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