Fitch Goes On Rampage: Cuts Spain, Italy, Belgium, Cyprus, And Slovenia

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    Jan 27, 2012 8:53 PM GMT
    Cue the moaning by liberal(s) over Fitch and wanting to shoot the messenger.

    http://www.businessinsider.com/fitch-goes-on-rampage-cuts-spain-italy-and-belgium-2012-1

    Fitch just cut the long-term issuer ratings of 5 EU countries:

    Belgium: AA+ to AA
    Spain: AA- to A
    Italy: A+ to A-
    Cyprus: BBB to BBB-
    Slovenia: AA- to A

    It affirmed Ireland's BBB+ rating with a negative outlook.

    Borrowing costs have been sinking for these countries lately–particularly for Italy and Spain—after the European Central Bank announced liquidity support measures in early December that have lessened mounting worries about the health of the banking system.

    While Fitch says that it supports EU leaders actions to address the crisis so far, a lot more has to happen before these countries are out of trouble:

    In Fitch's opinion, the eurozone crisis will only be resolved as and when there is broad economic recovery. It is evident that further substantial reforms of the governance of the eurozone will be required to secure economic and financial stability, including greater fiscal integration.

    In particular, Fitch suggested that large-scale purchases of sovereign bonds by domestic banks after the European Central Bank conducted its first LTRO in December has not helped matters in the long-run:

    Rising "home bias" in the allocation of capital, the divergence in monetary and credit conditions across the eurozone, and near-term economic outlook highlight the greater vulnerability to monetary as well as financing shocks faced by these sovereign governments.

    The downgrades are hardly surprising after S&P cut the long-term issuer ratings of nine eurozone countries two weeks ago. Markets haven't moved much on the news.
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    Jan 27, 2012 8:55 PM GMT
    It's not about "shooting the messenger". It's about the messenger having no clothes since they are paid by the very companies that benefit from the downgrading of sovereign debt. icon_rolleyes.gif
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    Jan 27, 2012 9:02 PM GMT
    Christian73 saidIt's not about "shooting the messenger". It's about the messenger having no clothes since they are paid by the very companies that benefit from the downgrading of sovereign debt. icon_rolleyes.gif


    And as indicative - ratings are lagging indicators. Companies that benefit from downgrading the sovereign debt? Which would they be and how?

    Have you ever considered looking into how markets work?
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    Jan 27, 2012 9:05 PM GMT
    riddler78 said
    Christian73 saidIt's not about "shooting the messenger". It's about the messenger having no clothes since they are paid by the very companies that benefit from the downgrading of sovereign debt. icon_rolleyes.gif


    And as indicative - ratings are lagging indicators. Companies that benefit from downgrading the sovereign debt? Which would they be and how?

    Have you ever considered looking into how markets work?


    Hedge funds that have bets against the sovereign debt, which you know and support. I know well how "markets work" and am smart enough to not believe in the Randian fairy tales you spout.
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    Jan 27, 2012 9:07 PM GMT
    Christian73 said
    riddler78 said
    Christian73 saidIt's not about "shooting the messenger". It's about the messenger having no clothes since they are paid by the very companies that benefit from the downgrading of sovereign debt. icon_rolleyes.gif


    And as indicative - ratings are lagging indicators. Companies that benefit from downgrading the sovereign debt? Which would they be and how?

    Have you ever considered looking into how markets work?


    Hedge funds that have bets against the sovereign debt, which you know and support. I know well how "markets work" and am smart enough to not believe in the Randian fairy tales you spout.


    Sure you are Christian - as for the hedge funds? Yeah, because the markets can be so easily manipulated by the fraction of assets these hedgefunds that don't even act as one.

    Sorry Christian - keep on trying to sell your crazy. Again, these are lagging indicators. Figure out what that means.
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    Jan 27, 2012 9:10 PM GMT
    riddler78 said
    Christian73 said
    riddler78 said
    Christian73 saidIt's not about "shooting the messenger". It's about the messenger having no clothes since they are paid by the very companies that benefit from the downgrading of sovereign debt. icon_rolleyes.gif


    And as indicative - ratings are lagging indicators. Companies that benefit from downgrading the sovereign debt? Which would they be and how?

    Have you ever considered looking into how markets work?


    Hedge funds that have bets against the sovereign debt, which you know and support. I know well how "markets work" and am smart enough to not believe in the Randian fairy tales you spout.


    Sure you are Christian - as for the hedge funds? Yeah, because the markets can be so easily manipulated by the fraction of assets these hedgefunds that don't even act as one.

    Sorry Christian - keep on trying to sell your crazy. Again, these are lagging indicators. Figure out what that means.


    Riddler - the entire CDS market was gamed by hedge funds and their enablers at rating agencies causing the financial crisis. Your ideology-based refusal to acknowledge the cause of the financial crisis blinds you to the actual causes.

    Try reading a book about the actual causes of the crisis and not what you wish it was. Then you can get back to me on how hedge funds are manipulating the markets.
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    Jan 27, 2012 9:15 PM GMT
    Christian73 said
    riddler78 said
    Christian73 said
    riddler78 said
    Christian73 saidIt's not about "shooting the messenger". It's about the messenger having no clothes since they are paid by the very companies that benefit from the downgrading of sovereign debt. icon_rolleyes.gif


    And as indicative - ratings are lagging indicators. Companies that benefit from downgrading the sovereign debt? Which would they be and how?

    Have you ever considered looking into how markets work?


    Hedge funds that have bets against the sovereign debt, which you know and support. I know well how "markets work" and am smart enough to not believe in the Randian fairy tales you spout.


    Sure you are Christian - as for the hedge funds? Yeah, because the markets can be so easily manipulated by the fraction of assets these hedgefunds that don't even act as one.

    Sorry Christian - keep on trying to sell your crazy. Again, these are lagging indicators. Figure out what that means.


    Riddler - the entire CDS market was gamed by hedge funds and their enablers at rating agencies causing the financial crisis. Your ideology-based refusal to acknowledge the cause of the financial crisis blinds you to the actual causes.

    Try reading a book about the actual causes of the crisis and not what you wish it was. Then you can get back to me on how hedge funds are manipulating the markets.


    Oh Christian - you're projecting again. Yeah - best of luck trying to convince anyone let alone someone who knows something about CDSs that especially on sovereign debts they've been manipulated sufficiently to bring down the market.

    Yeah - your refusal to accept that the overspending and massive amounts of debt have anything to do with the problems these countries are having aren't ideological icon_rolleyes.gif

    Lol - like seriously, who do you think you're fooling? Or are you just fooling yourself?