Moody's has down graded the UK from AAA to AA1 http://www.zerohedge.com/news/2013-02-22/farewell-aaa-moodys-downgrades-uk-aaa-aa1
Only downgraded 1 point?... I wonder how much the exchequer paid Moodies to keep it that restrained? Meanwhile, on the otherside of the pond, the US Govt is litigating S&P because they didn't downgade them early enough!.. That's like one of the guys at work who complained that we didn't bring him to task when we initially realised he'd been stealing, instead of letting him continue and gather evidence on the other dodgey stuff he was doing (like falsifying timesheets etc). He actually had the hide to complain that it was our responsibility to stop him from doing more illegal stuff.
Well ya know the ratings are merely a probability of default... BoE could fire up the printing press and they wouldn't default :lol:
Good thing they have all that gold in the Bank of England to fall back on. It's not like any country is going to mount an invasion of the UK to retrieve their gold, so the UK could just take that over, revalue Gold and be back on top of the world. Hang on ... that's where Australia's gold is!
When "they" say firing up the printing press, I don't think this is to be taken literally, isn't it just about the expansion of supply digital credit?
I'd say Goldmans and the UK government have given permission for Moody's to downgrade them otherwise the threat of a lawsuit would have been raised. It has/will devalue the pound which may save the electronic 0 key from being overused for a while. A good way of devaluing your currency without QE.
A good point, and currency devaluation is the name of the game these days. As sanchez says, a race to the bottom. BUT the ratings agencies is a poor way to achieve this goal, as banks and central banks hold bonds based on their rating. AAA rating is important for reserves, and preferential over AA1. I'm not sure if the finer details, but you'd think that the US would embrace its downgrade by S&P if it was so beneficial and actually achieved the goal of currency devaluation that the US has been seeking. Nothing is that simple in global finance, there's always a catch...
Looks like it was announced 30 mins before GBP trading closed, might be an opportunity to make some cash Monday morning. Most of the cash may have already been made but Im happy to pick up the remnants.
