Posted on 05/12/2010 7:39:45 PM PDT by TigerLikesRooster
Sovereign ratings on UK, US, Japan under fire from credit investors
Author: David Evans
Source: Credit | 12 May 2010
/snip
After Greece, Portugal and Spain suffered rating downgrades in April due to escalating fiscal problems, investors ask if the same standards are being applied to advanced economies.
While there is a broad agreement among investors that credit rating agencies were justified in downgrading peripheral European sovereigns last month, investors are questioning why advanced economies such as the UK, the US and Japan – which face mounting fiscal problems of their own – have managed to retain their triple-A ratings.
According to the International Monetary Fund, US debt-to-GDP is predicted to hit 109.7% in 2015, up from 83.2% at the end of last year. Over the same period, the UK’s debt ratio is expected to increase from 68.2% to 90.6%; while Japan’s debt burden is forecast to reach 248.8% in 2015, up from 217.6% at the end of 2009.
“The rating agencies haven't been consistent and some countries have been singled out more than others,” says Achilles Risvas, a managing partner at Dromeus Capital in Geneva.
/snip
Shahid Ikram, head of global sovereigns and absolute return at Aviva Investors, is unconvinced. He shares Risvas’ view there is a discrepancy in the application of downgrades, and that the UK’s triple-A rating is dubious given the severe fiscal problems it faces.
“People are looking at the peripheral economies, but you could have similar fears about Japan, the UK and the US. It’s a global phenomenon. Take the UK: look at its headline fiscal deficit, aggregate the fact that the public sector pension fund is off balance sheet, and that a lot of our recent capital investment from a government perspective has been done through private finance initiatives,....
(Excerpt) Read more at risk.net ...
P!
()bama, Soros, Ayers, Wright, Dohrn, the Emanual twins, Axelrod . . . everybody on the elitist Marxist side is celebrating.
WHERE are the Republicans calling for IMPEACHMENT???
The rating agencies will downgrade the US..just after we have a failed Bond Auction. Don’t expect them to actually warn us in advance.
Right now the US Bonds are selling because the US is the best port in the storm, but gold has done better for some time than US Bonds.
Here it comes ... that “other shoe” we’ve been waiting for.
That is because we can't default. We pay them back in dollars which we create in the federal reserve. It is much like the social security trust fund scam. The only problem is that the dollar as the world currency makes it so easy to borrow, that we will borrow more than we can ever pay back... in fact we will pay none of it back... except by borrowing it again from the federal reserve.
I think you know the answer.
We are buying our own debt. Nobody else wants it ;-)
RE :”We are buying our own debt. Nobody else wants it ;-)”
Certainly not liberals!
;-)
As soon as Moody’s and S&P downgrade America’s debt, they will be called in front of a Senate Subcommittee to explain their actions. (That is one show involving Congress I would actually pay to see.)
Sounds like the Return of the Bond Vigilantes.
Higher rates can’t be far away.
More like “Keynesian Death.”:-)
Hmm the UK should have been knocked down a couple notches,Japan has been knocked down and the US will probably be.............screwed.
House of Cards.
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