Idiot of the day: S&P
Interesting. So, during the whole last week, when Irish debt traded at 9% yield like a junk bond, the analysts from S&P believed that Irish debt deserved AA- rating. Then the news came that EU would bail out that bankrupt government. The financial geniuses from S&P thought about it and concluded that Irish bonds are now less safe than they were before the bailout announcement. I am wondering if anyone is still taking these clowns seriously.
"Standard & Poor's Ratings Services lowered its ratings on Ireland and will continue to watch for more downgrades, saying the country's borrowing to bail out banks exceeded its previous projections.
The Irish government is trying to stem its losses from the banking sector, which are largely the result of lending too much during a decade-long property boom that crumbled in the financial crisis.
On Sunday, Ireland applied for a bailout in the tens of billions of euros from the European Union and the International Monetary Fund to stabilize the banking system and state finances.
On Tuesday, S&P said it lowered its long-term sovereign rating on Ireland to A from AA-, a two-notch drop. It cut its short-term ratings a step to A-1. It put both on CreditWatch with negative implications, raising the possibility of further downgrades."