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UK has its "credit rating" cut by Moody's
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TOPIC: UK has its "credit rating" cut by Moody's
UK has its "credit rating" cut by Moody's 2 Years, 1 Month ago Karma: 279
There was much more in the Theater of the Absurd known as our financial markets at the end of last week, as noted bankster-accomplice Moody's credit-rating agency has "downgraded" the UK's credit rating from (the absolute highest) "AAA" to one step below that.

The absurdity here exists on many levels. Like most of the West's Deadbeat Debtors; the UK is already bankrupt -- with said bankruptcy merely being postponed by Ponzi-style money-printing. Thus any credit rating above "junk" is nothing but a ridiculous fraud.

However, that's just the starting point for the absurdity. Regular readers will recall that I've pointed out on several occasions what the propagandists at Bloomberg have already confessed. For the last 40 years; there has been absolutely no correlation between credit-ratings and the direction of interest rates.

They SHOULD matter. A downgrade should cause interest rates to spike (reflecting higher risk); while an upgrade should have the opposite effect -- lower risk translating into lower interest rates.

Completing the Theater of the Absurd here; I've explained the only possibilities as to why credit-ratings (in fact) don't have any impact at all on the bond-markets for sovereign debt:

1) The ratings agencies are incompetent buffoons, and thus no one takes them seriously.
2) The bond-markets are totally rigged, and thus bond prices/interest rates have utterly no connection to actual risk levels.
3) #1 and #2.

There are no other possibilities.

What this means, of course, is that this ratings downgrade (like hundreds of others over the past 40 years) will have no impact at all on the utterly rigged UK bond-market...

P.S. Note the hilarious lie in the propaganda below. There is "no need" for UK interest rates to rise after the downgrade -- because markets (with their crystal-balls) had already "priced in" the downgrade in UK bond markets.

New fears for pound after UK's credit rating drops

Sterling is expected to come under pressure tomorrow following the loss of Britain's gold-plated AAA credit rating.

The pound fell late on Friday after ratings agency Moody's downgraded the country to AA1 - warning sluggish growth would continue for years.

The UK currency has already come under significant pressure this year amid mounting fears of a downgrade as growth and public borrowing figures continue to disappoint.- falling about 7% against the US dollar to 1.51 US dollars.

It has also fallen strongly against the euro to 1.15 as the UK's deepening economic woes contrast with increasing optimism in the eurozone and hopes the single currency will survive after the European Central Bank launched its bond-buying rescue plan.

Howard Archer, chief UK and European economist at IHS Global, said the pound would be "particularly vulnerable" after the downgrade, but said the markets had been increasingly pricing in the AAA rating loss for some time...
Jeff Nielson
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