Moody's Cuts Rating of 6 European Nations
Britain, France warned that triple-A is in danger
By Rob Quinn, Newser Staff
Posted Feb 14, 2012 1:28 AM CST
France has kept its triple-A rating with Moody's, but the agency has revised its outlook to 'negative.'   (Getty Images)

(Newser) – Moody's has followed fellow ratings agency Standard & Poor's lead with a mass downgrading of European credit ratings. Spain, Italy, Portugal, Malta, Slovakia, and Slovenia—all of whose ratings were cut by S&P last month—were downgraded a notch. The agency also revised its outlook on France and Britain's triple-A rating to "negative," Bloomberg reports.

Moody's said the downgrades were triggered by "uncertainty over the euro area’s prospects for institutional reform of its fiscal and economic framework," and a weak economic outlook that threatens "the implementation of domestic austerity programs and the structural reforms that are needed to promote competitiveness." Moody's is alone among ratings agencies in downgrading its outlook for Britain. Although it was last to downgrade Spain and Portugal, it now grades them lower than its rivals, the Wall Street Journal notes.

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Feb 15, 2012 8:37 PM CST
Moody's? Does any investor actually listen to these idiots anymore, after they slapped AAA ratings on AIG, Bear-Stearns and all those toxic-junk subprime derivatives right about the day before they all went belly-up? Years after they'd done the same with Enron? The irony is that the downgraded countries if anything suffered because they were listening to Moody's back in 2008, took their advice on the AAA investments and sustained massive damage because of it- for which they're now downgraded. IOW, Moody's is effectively downgrading entire countries for having taking their own advice back in 2008. Boy, what a fun profession working for one of these credit-ratings agencies. You get to indulge in corruption and conflicts-of-interest with the very companies that you're rating, take marching orders from Goldman-Sachs and other corporate raiders to downgrade companies and entire nations to push down their apparent value and try to swoop in and buy them on the cheap (Shock Doctrine style), try to stir up self-fulfilling prophecies and depreciations to line the pockets of short-sellers and speculators who are buying you off, then thanks to Citizens United ruling you get to bribe and purchase the very politicians and regulators who are supposed to be keeping you in line, AND you get a gullible press to quote you even after you've been shown to be corrupt, incompetent and completely without credibility. That's gotta be a dream-job, maybe except for the fact that the rest of the world probably sees these guys as being more dangerous than any terrorist or military threat, with all the budding diplomatic incidents they're stirring up. And because the scam doesn't always work- an acquaintance of mine tried to short-sell bonds from France when S&P downgraded them, but lost his shirt when other investors weren't so stupid to fall for the ploy and pushed the value up. Most hilarious of all is that Britain is still AAA despite having deficit levels that are even worse than Greece, being torn apart by riots and already in a double-dip recession, while Continental nations in far better shape get downgraded. Spain for example has far less private debt than Britain and lower deficits, plus a better export profile especially since England in particular got the not-so-bright idea of shipping all its manufacturing overseas. (China's main credit-ratings agency for example, which has the advantage of not being bought and bribed by Goldman-Sachs and the hedge funds, has Britain at one of it's lowest notches among industrialized nations, which is consistent with what the rest of the non-bribed investor class has concluded.) But golly gee, wouldn't wanna downgrade the UK with all those bankers in London bribing the credit-ratings agencies. If Moody's and S&P had any credibility left, they lost it in effect by not downgrading Britain even as they hit these other countries. I'm thinking that maybe Moody's, Fitch and S&P are useful in a reverse-metrics kind of way. Whatever they do or advise, smart investors would do the opposite. Besides the satisfaction of bankrupting, ruining and humiliating the short-sellers and crooks who are trying to profit of the misery of solid countries, it's probably now the best and most reliable get-rich-quick scheme available.
Feb 15, 2012 5:36 PM CST
Germany strong
Feb 14, 2012 5:47 AM CST
It's all fun and games until someone downgrades Moody's.