Last week I wrote an article for the Illinois Policy Institute on the hugely unfunded and deteriorating outlook for Illinois' numerous pension systems,well ahead of downgrades on Chicago's debt by Moody's on Friday.I will post the article on my blog on Monday. Knowing what I do about Illinois pensions, I was not surprised to see this Bloomberg story on Friday: Chicago Credit Rating Cut by Moody's to Two Steps Above Junk.
ATHENS — Ratings agency Fitch upgraded its sovereign credit rating for Greece by one notch on Tuesday, citing the country’s progress in cutting its budget deficit and the receding risk of its eurozone exit.
After nearly crashing out of the euro last year and coming under attack for stalled reforms, Greece has won praise in recent months from its international lenders for getting back on track and pushing through unpopular austerity measures.
With Japan's public debt about to hit 240% of GDP, Fitch Downgrades Japan's Sovereign Rating
The ratings agency Fitch on Tuesday lowered its assessment of Japan’s sovereign credit to A+, an investment grade just above the likes of Spain and Italy, and criticized Tokyo for not doing more to pare down its burgeoning debt.
The outlook for Canada’s economy is becoming increasingly tentative, and that is putting key reforms— from erasing government deficits to heftier pension payments — out of reach for now.
Finance ministers across the country share the same roadblocks to growth as their federal counterparts. Attempts to clear those away have been set back by economic problems beyond their control.
The shockingly bad fiscal health of Chicago just got a lot worse. Not only were Chicago Teachers "Insulted by a 7% Pay Cut Offer", the Illinois Supreme Court ruled Illinois' 2013 pension reform is unconstitutional.Moody's Cuts Chicago Bond Rating to Junk As a result of the Supreme Court ruling, Illinois' already horrendously underfunded pension plans are even more underfunded.
Recent developments at Bank of Nova Scotia, including an acquisition that resulted in more exposure to consumer credit, has prompted Moody’s Investors Service to change the outlook to negative on the bank’s financial strength rating.
In a report Wednesday, the ratings agency cited a trio of items that “could signal a shift in the bank’s risk appetite.”
A year ago, in order to prevent the collapse of the Eurozone, the ECB came out with the first (of many) deus ex machina bazooka when it unveiled the OMT - a massive project so ambitious, it never actually existed (its legal term sheet has never been unveiled and never will be unveiled simply because it is by definition impossible) but was merely intended to scare everyone into submission by the ECB's sheer will (or stupidity - it is still unclear which prevailed).
Marshall Auerback submits:
By Marshall Auerback
So ratings agency Standard & Poor’s revised the U.S. rating outlook to negative from stable after affirming its sovereign rating at AAA/A-1+ sovereign credit ratings. Why people give credibility to the organization that gave us “triple AAA rated” subprime toxic garbage is beyond me. And take a look at the history: Debt downgrades had no impact on Japan when Moody’s and S&P tried to pull the same stunt with them.