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Cullion
29th May 10, 01:11 PM
The Fitch rating agency has downgraded the Spanish government's creditworthiness from AAA to AA+. This follows on the heels of Standard & Poor downgrading their rating for the country.

http://news.bbc.co.uk/1/hi/business/10188324.stm

Spanish real estate was particularly overvalued at the height of the credit bubble, and as this pushes up interest rates in Spain, it's likely to accelerate the liquidation of highly-levereged overvalued retail, hotel and holiday home developments that had been springing up at a feverish pace during the boom.

It will also put the Euro under deeper distress.

cuatro76
29th May 10, 05:59 PM
So this is a good thing for tourists, right? I'm going to Barcelona in July.

Cullion
29th May 10, 06:02 PM
The problem is that spain's specific finances don't directly affect their currency. They can't devalue as much as they would if they had a 'spain specific' currency.

But overall, yes it's likely that the Euro will sink vs the dollar. Just not as much as the old Peso would've done on this news.

Adouglasmhor
29th May 10, 06:16 PM
Who do you reckon is next?

cuatro76
29th May 10, 06:18 PM
Will there be riots?
Spain's Parliament just cut Austerity benefits. And the unemployment rate is 20%.
We saw what happened in Greece.

Cullion
29th May 10, 06:25 PM
Spain, to my current knowledge isn't in as deep trouble as Greece, and they started making cuts earlier in the process. They made mistakes but it doesn't look like they got things as fucked up as the Greeks did before reacting. I don't think it will be as bad for them.

The real question is how this debt-rating downgrade adds to the overall problem.

Phrost
29th May 10, 07:49 PM
Weren't we supposed to be emulating Spain's new "Green" economy, according to Obama?

Cullion
29th May 10, 07:57 PM
Who do you reckon is next?

Portugal, then Italy, then in the grand 'oh shit' finale, the UK.

Cullion
29th May 10, 07:58 PM
Weren't we supposed to be emulating Spain's new "Green" economy, according to Obama?

Meh, I haven't been following him much now. What's his opinion worth ? He's just a back-seat affirmitive action case who never did a real day's work. I think it's becoming kind of painfully obvious now.

jkdbuck76
29th May 10, 08:56 PM
B-b-but. Ch-ch-change. .... Hope......

Cullion
29th May 10, 08:58 PM
Let's wait to see what his Goldman Sachs handlers have to say.

Adouglasmhor
30th May 10, 04:51 AM
Portugal, then Italy, then in the grand 'oh shit' finale, the UK.

Do you think Ireland's cutting austerity was enough to save them?

Cullion
30th May 10, 07:24 AM
Yes, I think Ireland made big enough cuts, early enough. It was a crappy experience to be working in the Irish public sector the last couple of years, but I think they're going to make it.

Vieux Normand
30th May 10, 09:22 PM
Portugal, then Italy, then in the grand 'oh shit' finale, the UK.

Didn't you miss somebody? Your favourite neighbour can't possibly have become solvent, no matter have much profit they rake in from the arms trade.

Cullion
31st May 10, 08:01 AM
The French will find a way to wriggle out of it and make it look like somebody else's fault.

Vieux Normand
31st May 10, 08:01 PM
The French will find a way to wriggle out of it and make it look like somebody else's fault.

...AND WHOSE FAULT IS THAT?!!?

Cullion
1st June 10, 03:02 AM
Germany's, obviously.

EuropIan
1st June 10, 07:47 AM
The rest of Europe blaming Germany for its ills.

Typical

Cullion
1st June 10, 07:49 AM
We aren't.