Ratings agency threatens eurozone downgrade

[Che -Guevara]

[Che -Guevara]

It's amazing how these rating agencies can cause panic in the global economy.

[Carafaat]

they are not the cause. they just analyse and rate. if you wanna critize rating agencies, critisize them for not seeing the faults and risks in the market far earlier then now.

[Che -Guevara]

They were giving raving reviews to the most of the products being peddled by the financial power houses and many companies that went under. In fact, there were complicit in the whole thing and should suffered at-least some consequence. The three big rating agencies need to be challenged and perhaps broken up.

[Showqi]

A lot of companies are cooking the books, and the rating agencies have no choice than to change their first rating after they find out the truth. This is the only way you can make the world market transparent. Better late then never.

[ElPunto]

^It's the job of the ratings agencies(and the accountants) to make sure they're not cooking the books. How else can you hope to give an accurate rating?

 

More fundamentally these ratings agencies have a huge conflict of interest. They're paid directly by the organizations they rate. And companies routinely ask them what concotion of debt products to package together to 'merit' a safe rating. These are the same folks who took crap sub-prime, sliced and diced by adding other pieces of 'safer' debt together and presto chango you have a debt product that your grandmother can safely buy. Except that it all went to zero.

 

And now that Europe is in trouble - they're racing to downgrade or warn of downgrades so that they won't be blamed later. S&P put all 27 member euro countries on negative dowgrade watch - just a big example of CYA.

 

There is a reason in Islamic finance that debt products cannot be traded at any other price but par.

[Showqi]

Fitch cuts Goldman, Deutsche, five other large banks

 

(Reuters) - Fitch Ratings, the third-biggest of the major credit rating agencies, on Thursday downgraded Goldman Sachs, Deutsche Bank and five other large banks based in Europe and the United States, citing "increased challenges" in the financial markets.

 

Fitch cut long-term ratings on Barclays Plc and Credit Suisse AG by two notches to 'A' from 'AA-'.

 

The agency cut by one notch its long-term ratings on Bank of America Corp, BNP Paribas, Citigroup, Deutsche Bank AG and Goldman Sachs Group.

 

The financial market challenges the banks face "result from both economic developments as well as a myriad of regulatory changes," Fitch said in an announcement issued shortly after regular market hours in New York.

 

In a separate announcement about the downgrade of Citigroup, Fitch cited "policy momentum" against using taxpayer money to support banks during a crisis.

 

Fitch's actions follow downgrades by Standard & Poor's of several major banks at the end of last month. S&P's moves came as part of an overhaul of its ratings methods to incorporate lessons learned in the financial crisis. Moody's also issued downgrades recently.

 

Jerry Dubrowski, a spokesman for Bank of America, which has had ratings cut by all three agencies, said in an email, "This decision is driven more by concerns about the global economy than the specific credit quality of Bank of America. We continue to maintain strong liquidity levels and to build capital."

 

Fitch on Thursday also affirmed its long-term 'A' ratings on JPMorgan Chase & Co, Morgan Stanley and UBS AG, as well as its 'A+' rating on Societe Generale.

 

(Reporting by David Henry and Walter Brandimarte in New York and Rick Rothacker in Charlotte, North Carolina; Editing by Steve Orlofsky and Richard Chang)

 

http://finance.yahoo.com/news/fitch-cuts-goldman-deutsche-five-014753760.html

[Nin-Yaaban]

Maybe its just me, but Walahi, i have been having these dreams where something big is about to happen because of all these financial crisis that's been happening in the U.S and Europe. Seems like there is something weird or crazy happening everytime you turn the news on. Ilahayow nacafi.

[Showqi]

France loses AAA-rating in blow to eurozone

S&P cuts France's rating to AA, hurting eurozone's ability to fight off crisis

 

 

 

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.

 

THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP's earlier story is below.

 

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.

 

You can read the entire article------> http://finance.yahoo.com/news/france-loses-aaa-rating-blow-191612943.html;_ylt=Ah0KJW5dq9DcMlU2J9fcgM2iuYdG;_ylu=X3oDMTQzNmRxM2JyBG1pdANGaW5hbmNlIEZQIEp1bWJvdHJvbiBMaXRlBHBrZwMxODNiNTdlZi1lODc0LTNlYTAtYWQ5MC1kOWM4ZWJlZDE0ODcEcG9zAzEEc2VjA2p1bWJvdHJvbgR2ZXIDNzUxZWQ2ZTAtM2UxYi0xMWUxLWJkN2YtOTU1MmZjMmRjYjEx;_ylg=X3oDMTFvdnRqYzJoBGludGwDdXMEbGFuZwNlbi11cwRwc3RhaWQDBHBzdGNhdANob21lBHB0A3NlY3Rpb25zBHRlc3QD;_ylv=3