Moody's fears social unrest as AAA states implement austerity plans

Discussion in 'Wall St. News' started by achilles28, Mar 16, 2010.

  1. By Ambrose Evans-Pritchard
    Published: 6:48PM GMT 15 Mar 2010

    The world's five biggest AAA-rated states are all at risk of soaring debt costs and will have to implement austerity plans that threaten "social cohesion", according to a report on sovereign debt by Moody's.

    The US rating agency said the US, the UK, Germany, France, and Spain are walking a tightrope as they try to bring public finances under control without nipping recovery in the bud. It warned of "substantial execution risk" in withdrawal of stimulus.

    "Growth alone will not resolve an increasingly complicated debt equation. Preserving debt affordability at levels consistent with AAA ratings will invariably require fiscal adjustments of a magnitude that, in some cases, will test social cohesion," said Pierre Cailleteau, the chief author.

    "We are not talking about revolution, but the severity of the crisis will force governments to make painful choices that expose weaknesses in society," he said.

    If countries tighten too soon, they risk stifling recovery and making maters worse by eroding tax revenues: yet waiting too is "no less risky" as it would test market patience. "At the current elevated debt levels, a rise in the government's cost of funding can very quickly render debt much less affordable."
  2. Isn't it time America considered an outright default?

    The Fed, China and Japan get nothing. We honor treasuries only held by private US citizens/funds/corporations?

    Is this a workable solution? Or does it invite WW3?
  3. We are seeing a far more weird and sinister variant of anything ever seen in American "politics." It is as though the "power elite" have decided that America collapses in 2012. As far as I can see...the stock markets are being propped up (like today - a fucking joke - bad housing numbers, but we end "up" on the DJIA - fucking bullshit!!!). The stock markets will be propped up until 2012. The world financial markets are "vexed" until 2012...when all shit hits the fan. I am NOT saying I am right or connected to this bullshit...only that it appears that way to me. Bond markets...same thing - why hasn't the US Treasury bond crashed - it is a known fact that the Social Security "fund" will become net negative this year...but no fucking awful response...the "health care reform" - oh, that won't REALLY hit until AFTER 2012...WHY???

    I am NOT being superstitious here - just observant!

  4. Crack me up. I hope the "social unrest" lands right on Moody's doorstep.
  5. If it only landed on their lap...I would howl in laughter, bu sadly, it will be pervasive throughout the world. Over seems like Gerald Celente's predictions are becoming correct.

  6. Gerald Celente


    never heard of him, looked him up on wiki, I'll have to read up on him sound interesting.