DOWNGRADE! Euro Zone Collapses
Several euro zone countries face an “imminent” downgrade by ratings agency S&P, Reuters and Dow Jones news agencies reported on Friday afternoon, sending the euro to a session low against the dollar and European stocks down.
The reports said Germany and the Netherlands were not among the countries facing a downgrade later on Friday, but gave no further details.
According to Dow Jones sources, France was among the countries set to be downgraded.
“Remain alert tonight when U.S. markets close,” Reuters cited a source as saying.
S&P warned in December that it could downgrade the credit ratings of several euro zone nations if European leaders failed to find a lasting solution to the debt crisis at a meeting of EU leaders that month.
A spokesperson for S&P in Paris declined to comment on the reports.
John Wraith, Fixed Income Strategist at Bank of America Merrill Lynch told CNBC the confirmation of a mass downgrade would be another serious step in the crisis and would lead to a serious worsening of sentiment.
“Clearly these won’t come out of a clear blue sky. These countries have all been on negative credit watch for the last four weeks and many observers — ourselves included — did expect that process to end with ratings action,” he said
“To a large degree it’s widely anticipated. However, we think the reality of it is going to have a knock-on, ongoing impact on these markets.”
“It clearly deteriorates still further the credit worthiness of a lot of the European banks and just keeps that negative feedback loop between struggling banks and the sovereigns that may have to support them if things go from bad to worse in full force,” Wraith added.
URL: http://www.cnbc.com/id/45985456
Christopher Greene is the creator of GreeneWave.
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cgreene - January 13, 2012
I just love how in the midst of the supposed ‘Greatest Green Shoot Recovery’ in history the Euro Zone continues to collapse. My two cents, the Euro currency collapses for good this year!
IBAMIE - January 13, 2012
I have to agree with you Chris, but the U.S. isn’t far behind. My husband (huge fan of yours by the way) printed off something showing the NYSE past and current trends and with some calculous voo-doo that he does, graphed the crash to be sometime around Dec 2012 *if the trends continue as they have been* <—disclaimer — LOL
falcon15 - January 14, 2012
We are facing a huge decoupling and crash before December of 2012. The markets and charts cannot be trusted. They are heavily manipulated and not a true measure of commerce. economic stability, growth, trends, anything. It will start with market closures and bank holidays. Bank on it. Pun intended. Got preps? Pray for the best, prepare for the worst.
reyteje - February 17, 2012
Why are you fooling with the economy?
Get it?
Let´s get the euro down to the US dollar or viceversa and many of these unstable times will fade away…
STOP FOOLING around, the sooner the better!