Yesterday, S&P affirmed its AAA long-term sovereign credit rating on the US, but revised its outlook on the long-term rating to negative from stable. Full coverage of this is available on Business Monitor Online, but here are my thoughts: This change in outlook, according to their methodology, implies a 33% chance that S&P will actually… [Read more]

The Portuguese government finally caved in on April 6 and requested a European Union (EU) bailout. This was effectively a non-event, however. My colleagues and I had long expected the Portuguese to seek external assistance in Q2 2011, and judging by the muted reaction in the euro and bond spreads, the market had already priced… [Read more]

Regular readers of this blog will know that I have been to Dubai a couple of times over the past few years, most recently in March 2010 (see Dubai: Notes From A City At The Cross Roads) and have commented several times on the emirate’s financial crisis. Well, now I have come back from another… [Read more]

Given that President Hugo Chávez’s Partido Socialista Unido de Venezuela (PSUV) lost its two-thirds majority in the September 26 legislative elections, it is pretty likely that the ruling party is going to face a tougher time in passing some of the more radical elements of its socialist reforms. In addition, the 2012 presidential vote is… [Read more]

As I write this, Japan is once again in a funk. The yen has come ever so close to its post-WW2 high of JPY79.70/US$ seen in 1995, the Nikkei has touched 16-month lows, and now, the governing Democratic Party of Japan (DPJ) has become embroiled in an internal power struggle between Prime Minister Naoto Kan… [Read more]

China’s Dagong Global Credit Rating Co earlier this week released what it described as the first ever assessment of sovereign credit risks by a non-Western ratings agency. Dagong’s report covers 50 countries (20 in Europe, 17 in Asia, 2 in North America, 6 in South America, 3 in Africa, and 2 in Oceania) comprising 90%… [Read more]

The last few weeks have marked a low point in French President Nicolas Sarkozy’s time at the Elysee Palace, and the pressure is unlikely to let up any time soon. Although his embattled Labour Minister Eric Woerth was ‘acquitted’ over a tax cover-up by the Finance Ministry on Sunday, accusations that both Woerth and Sarkozy… [Read more]