Monday, January 12, 2009

S&P puts Spain on CreditWatch negative...

Debt has permeated the globe. The saying that “they” are worse off than the U.S. is true to a large degree, but the entire system is in trouble if you ask me. The ratings agencies and the way they changed their business model to “pay for rating” has to be fixed or they just flat out need to be eliminated.

MarketWatch Story
S&P puts Spain on CreditWatch negative

By Steve Goldstein

LONDON (MarketWatch) -- Standard & Poor's has put the AAA rating of Spain on CreditWatch negative, meaning the rating agency may downgrade its rating. "The CreditWatch placement reflects our view of the significant challenges facing the Spanish economy as it traverses a period of very weak growth, and a sustained period of deleveraging, which we expect to lead to a rebalancing toward traded sectors requiring real exchange rate depreciation," Standard & Poor's credit analyst Trevor Cullinan said. "The likely result of such factors will be a much weaker potential growth rate over the medium term than that experienced over the past decade. At the same time, we project a substantial worsening in the Kingdom's public finances."