Sovereign debt watch

[campbell]

As a companion to the treasury rate watch.

What up, Spain?
http://www.bloomberg.com/apps/news?p...PSGay0AQ&pos=1

Spain lost its AAA credit grade at Fitch Ratings as Europe battles a debt crisis that’s prompted policy makers to forge an almost $1 trillion bailout package for the region’s weakest economies.

The ratings company cut the grade one step yesterday to AA+ and assigned it a “stable” outlook, according to a statement from London. Spain has held the top rating at Fitch since 2003. Standard & Poor’s lowered Spain’s ratings to AA on April 28.

Who will be the first to default?

Place your bets, place your bets!

[zeuz]

Portugal

[campbell]

http://m.yahoo.com/w/ynews/article/t...tl=us&.lang=en

ITALY:

2009 debt: 115.8 percent of gross domestic product

Deficit: 5.3 percent of GDP.
…..

Still, rising market pressures on other countries has forced Prime Minister Silvio Berlusconi's government to announce spending cuts to reassure bond investors the country's finances are under control.

That surprised Italians after they had been assured for months by Berlusconi and his aides that Italy would escape the government crisis without painful measures.

A politician talking happy, but having to go back on his word. Why, I've never heard such a thing!

GREECE:

2009 debt: 115.1 percent of GDP.

Deficit: 13.6 percent.

Deficit projection for 2010: 8.1 percent.
….
BELGIUM :

2009 debt: 96.7 percent of GDP

Deficit: 6 percent.
….
FRANCE:

2009 debt: 78.1 percent of GDP.

Deficit: 7.5 percent of GDP.
….
Five months after unveiling a euro 35 billion "Big Loan" aimed at spurring France 's moribund economy to life, French President Nicolas Sarkozy announced this week that tackling 30 years of accumulated deficits is now a "national priority."
…..
PORTUGAL:

2009 debt: 76.6 percent of GDP

Deficit: 9.4 percent of GDP
….

GERMANY:

2009 debt: 73.2 percent of GDP

Deficit: 3.1 percent of GDP
….

IRELAND: 2009 debt: 65 percent of GDP.

Deficit: 14.3 percent.
…..


BRITAIN :

2009/10 estimated debt as percentage of GDP: 62 percent.

Deficit: 10.4 percent.
…..

Public finances in Britain, which does not use the euro, have shown signs of slowing deterioration in recent months, but remain at record levels.

Britain does have some advantages over countries like Greece: it prints the currency in which its liabilities are denominated, so it can devalue and make its exports more competitive. It is considered a surer bet for repayment, maintaining a triple-A credit rating. Still, the new coalition government headed by Prime Minister David Cameron of the Conservative Party has made cutting debt its priority to get the country "back open for business."
….
NETHERLANDS:

2009 debt: 61 percent of GDP

Deficit: 3.4 percent of GDP

….

But its unusually large financial services sector led to an abrupt spike in national debt largely due to bailouts during the crisis.

Although the Dutch are in an anti-Europe mood and many would love to see the return of the guilder, policymakers recognize that but for its euro-membership, the Netherlands might well have wound up like Iceland and seen its currency and banking system collapse.
….

SPAIN: 2009 debt: 55.2 percent of GDP

Deficit: 11.2 percent of GDP
….

Spain is grappling with the twin woes of a moribund economy and a lopsided deficit that is triggering fears of a Greek-style debt crisis. The government has cut spending to chip away at the deficit, but acknowledged that this will also chop half a percentage point off its forecast for growth in 2011, down to 1.3 percent. And there are doubts over whether that level of growth can generate net employment and ease the 20 percent jobless rate. Before the economic crisis, Spain relied heavily on free-flowing credit and a red-hot construction sector.

[oirg]

Why didn't you include the US on your watch list?

[campbell]

Well, not the U.S. itself at this point, but hey, let me throw in states here as well.

I'm too lazy to start a new thread, and besides, it seems just as relevant that Connecticut is getting its rating slashed as hearing the same about Spain. Both have debt denominated in a currency they don't control [and thus can't inflate their way out of it.... well, not by themselves, at least.]

http://www.economicpolicyjournal.com...thiest-us.html

Connecticut is preparing to borrow $956 million to close a budget gap in the fiscal year beginning July 1, after borrowing money last year to cover a deficit of $947.6 million. Not good. Fitch has reduced the states credit rating from AA+ to AA.

“The downgrade reflects the state’s reduced financial flexibility, illustrated by its reliance on sizable debt issuances during the current biennium to close operating gaps in the context of already high liabilities,” Fitch said.

Connecticut is the wealthiest state on a per capita basis with personal income of $54,397 in 2009, according to Department of Commerce.

[HatCapitol]

Any figures on Switzerland or Norway?

[campbell]

Hasn't popped up on my radar yet.

[vtek]

how about canada? (or individual provinces, at least)

japan seems to be deteriorating, too

[1695814]

who owns all this debt? china?

[campbell]

Yeah, I need to find something on Japan. I read a deadtree WSJ article, but I figure there's more stuff out there....