Moody’s: Cyprus Euro Exit Risk Substantial

Moody’s: Cyprus Euro Exit Risk Substantial (ZeroHedge, March 27, 2013):

Though it may seem a little like stating the obvious to many, Moody’s comments:

While the risk of a euro exit by Cyprus is substantial… …following the economic dislocation that will be caused by the restructuring of the island’s two largest banks and the imposition of capital controls in the country, it is possible that the risk of euro exit will increase further.

And so while the talking heads discuss Cyprus as a unique situation and too small to care about, it seems the reality of the last two weeks has actually raised their chance of Euro exit as opposed to bailed them into the Euro.

Moody’s lowers Cyprus’s country ceilings to Caa2

Read moreMoody’s: Cyprus Euro Exit Risk Substantial

Farewell Eng£AAAnd: Moody’s Downgrades UK’s Credit Rating From AAA To Aa1

Farewell AAA: Moody’s Downgrades The UK From AAA To Aa1 (ZeroHedge, Feb 22, 2013):

Just the headline for now:

  • MOODY’S DOWNGRADES UK’S GOVERNMENT BOND RATING TO Aa1 FROM AAA

Someone must have clued Moody’s on the fact that the UK is about to have its very own Goldman banker, which means consolidated debt/GDP will soon need four digits. In other news, every lawyer in the UK is now celebrating because come Monday Moody’s will be sued to smithereens.

Cable not happy as it tests 31 month lows…

Full report below:

Read moreFarewell Eng£AAAnd: Moody’s Downgrades UK’s Credit Rating From AAA To Aa1

As Euro Banks Return €137 Billion In Cash, Moody’s Warns “European Banks Need More Cash”

As Euro Banks Return €137 Billion In Cash, Moody’s Warns “European Banks Need More Cash” (ZeroHedge, Jan 25, 2013):

Europe has now officially become the Schrodinger continent, demanding both sides of the economic coin so to speak, and is stuck between the proverbial rock and hard place (or “a cake and eating it”). On one hand it wants to telegraph its financial system is getting stronger, and doesn’t need trillions in implicit and explicit ECB backstops, on the other it needs a liquidity buffer against an economy that, especially in the periphary, is rapidly deteriorating (Spanish bad debt just hit a new all time high while Italian bad loans rose by 16.7% in one year as more and more assets become impaired). On one hand it wants a strong currency to avoid any doubt that there is redenomination risk, on the other it desperately needs a weak currency to spur exports out of the Eurozone (as Spain showed when the EUR plunged in 2012, however that weak currency is now a distant memory and it is now seriously weighing on exports). On the one hand Europe wants to show its banks have solidarity with one another and will support each other, on the other those banks that are in a stronger position can’t wait to shed the stigma of being associated with the weak banks (in this case by accepting LTRO bailouts).

It is the latest that is the most glaring dichotomy because as reported earlier, while some 278 banks, or about half of the original LTRO participants, voluntarily paid back some €137 billion to the ECB, it is none other than Moody’s warning that European banks, especially those in the periphery, will need much more cash.

Read moreAs Euro Banks Return €137 Billion In Cash, Moody’s Warns “European Banks Need More Cash”

Moody’s Warns On USAAA Rating

Moody’s Warns On USAAA Rating; IMF Piles On (ZeroHedge, Jan 2, 2012):

Moody’s has stepped forward with the first warning shot across the bow that:

  • *MOODY’S: MORE MEDIUM TERM ACTIONS MAY BE NEEDED TO SUPPORT Aaa

Has contradicted itself (from September) on the debt-ceiling breach; and warns that while the deal ‘mitigates’ some fiscal drag, it does not remove it. To wit: the IMF piles on:

  • *IMF SAYS `MORE REMAINS TO BE DONE’ ON U.S. PUBLIC FINANCES
  • *IMF SAYS U.S. DEBT CEILING SHOULD BE RAISED `EXPEDITIOUSLY’

Full statements below.

Read moreMoody’s Warns On USAAA Rating

Moody’s Downgrades France’s Credit Rating From AAA To Aa1 (Full Text)

One Less In The AAA Club: Moody’s Downgrades FrAAnce From AAA To Aa1 – Full Text (ZeroHedge, Nov 19, 2012):

After hours shots fired, with Moody’s hitting the long overdue one notch gong on France:

  • MOODY’S DOWNGRADES FRANCE’S GOVT BOND RATING TO Aa1 FROM Aaa
  • FRANCE MAINTAINS NEGATIVE OUTLOOK BY MOODY’S

Euro tumbling. In other news, UK: AAA/Aaa; France: AA+/Aa1… Let the flame wars begin

From the release:

Moody’s decision to downgrade France’s rating and maintain the negative outlook reflects the following key interrelated factors:

Read moreMoody’s Downgrades France’s Credit Rating From AAA To Aa1 (Full Text)

ADP ‘Cancels’ 365,000 Private Jobs Created In 2012: ‘If You Think America Created Jobs, It Didn’t. ADP Made That Happen.’

ADP “Cancels” 365,000 Private Jobs Created In 2012 (ZeroHedge, Oct 31, 2012):

Frequent readers know that in addition of any “data” and “numbers” out of Larry Yun’s National Association of Realtors, which we openly boycott as these are consistently manipulated (recall the massive historical December 2011 revision), slanted and conflicted, the second dataset which we have mocked with a passion is anything coming out of the ADP, which every month releases its “Private Jobs” number a day before the official BLS Non-farm Payroll data. Today, our mockeries have been proven 100% spot on. The reason? A week ago, ADP announced that going forward it would coordinate with Moody’s (yes, that Moody’s), and especially its chief economist, SecTres hopeful (InTrade odds of actually attain that post: 0.00) Mark Zandi, to fudge adjust its data going forward. The data revision was supposed to be publicly disclosed tomorrow when the official October ADP number was released. Well, just like today’s Chicago PMI, and so many other data points recently, this too was released early. What the early release allowed us to promptly calculate is that using the historically revised numbers, and comparing those based on the original methodology, in 2012 alone, the US would have lost a whopping… 365,000 private jobs! Putting thus number in context, according to the revised methodology, the US has generated only 1.172MM jobs in 2012 through September, or in other words, a statistical “fix” magically eliminated over 30% of what the market had previously expected were job gains, a number which the incumbent president has certain taken advantage of on more than one occasions while campaigning.The chart below shows the old data series (which can still be found at the St. Louis Fed), and the new series, which can be extracted from the advance leaked press release. The cumulative difference is the black line. It needs no explanation.

What is also of note, is that had ADP used its revised methodology, it would have missed 5 out of the past 7 Wall Street consensus estimates.

As an added bonus, whereas according to the previous release, which we were lucky enough to tag here, the US generated +4,000 manufacturing jobs in September, the new release indicates that in the same month, the US actually lost -17,400 manufacturing jobs. Perhaps it is time to rerun the Ohio presidential speeches one more time…

And that is how “precise” supposedly the far more accurate ADP (at least in comparison to the NFP’s wild X-12-ARIMA extrapolated goalseeked data) was historically.

Read moreADP ‘Cancels’ 365,000 Private Jobs Created In 2012: ‘If You Think America Created Jobs, It Didn’t. ADP Made That Happen.’

Moody’s Warns Of 1 Notch Downgrade If A Bitterly Divided Congress Does Not Begin To Cooperate

Moody’s Warns Of 1 Notch Downgrade If A Bitterly Divided Congress Does Not Begin To Cooperate (ZeroHedge, Sep 11, 2012):

13 months ago, in the aftermath of the debt ceiling fiasco, which we now know was a last minute compromise achieved almost entirely thanks to the market plunging to 2011 lows, S&P had the guts to downgrade the US. Moody’s did not. Now, it is Moody’s turn to fire up the threat cannon with a release in which it says that should the inevitable come to pass, i.e. should congressional negotiations not “lead to specific policies that produce a stabilization and then downward trend in the ratio of federal debt to GDP over the medium term” then “Moody’s would expect to lower the rating, probably to Aa1” or a one notch cut. Moody’s also warns that should a repeat of last year’s debt ceiling fiasco occur, it will also most likely cut the US. Of course, that the US/GDP has risen by about 8% since the last August fiasco has now been apparently forgotten by both S&P and Moodys. Sadly, continued deterioration in the US credit profile is inevitable, as every single aspect of modern day lives that is “better than its was 4 years ago” has been borrowed from the future. More importantly, with the S&P at multi year highs courtesy of Bernanke using monetary policy to replace the need for fiscal policy, Congress will see no need to act, and Moody’s warning will be completely ignored. This will continue until it no longer can.From Moody’s:

Budget negotiations during the 2013 Congressional legislative session will likely determine the direction of the US government’s Aaa rating and negative outlook, says Moody’s Investors Service in the report “Update of the Outlook for the US Government Debt Rating.”

If those negotiations lead to specific policies that produce a stabilization and then downward trend in the ratio of federal debt to GDP over the medium term, the rating will likely be affirmed and the outlook returned to stable, says Moody’s.

If those negotiations fail to produce such policies, however, Moody’s would expect to lower the rating, probably to Aa1.

Read moreMoody’s Warns Of 1 Notch Downgrade If A Bitterly Divided Congress Does Not Begin To Cooperate

Moody’s Says U.S. Faces Aaa Cut Without Budget Deal in 2013

Moody’s Says U.S. Faces Aaa Cut Without Budget Deal in 2013 (Bloomberg, Sep 11, 2012):

Moody’s Investors Service said it may join Standard & Poor’s in downgrading the U.S.’s credit rating unless Congress next year reduces the percentage of debt- to-gross-domestic-product during budget negotiations.

The U.S. economy will probably tip into recession next year if lawmakers and President Barack Obama can’t break an impasse over the federal budget and if George W. Bush-era tax cuts expire in what’s become known as the “fiscal cliff,” according to a report by the nonpartisan Congressional Budget Office published on Aug. 22. The rating would likely be cut to Aa1 from Aaa if an agreement on the debt ratio isn’t reached, Moody’s said in a statement today.

Read moreMoody’s Says U.S. Faces Aaa Cut Without Budget Deal in 2013

Moody’s Downgraded Nearly 300 US Municipals

Moody’s downgraded nearly 300 U.S. municipal issuers in the second quarter, the most for any quarter in more than a decade and the latest sign of the potential pressure building in the market where states and local governments raise money.

Local areas across the U.S. have been struggling for several years after the recession sharply undercut revenues, with three cities in California recently filing for bankruptcy in an attempt to alleviate their financial burdens.

Tax receipts have rebounded but not enough to compensate for rising costs, which include healthcare spending, social welfare and labor.

Read moreMoody’s Downgraded Nearly 300 US Municipals

UK Economic Outlook Slumps – UK May Lose Triple-A Rating If GDP Growth Continues To Disappoint, Warns Moody’s

UK economic outlook slumps on eurozone crisis (Guardian, July 31, 2012):
UK may lose triple-A rating if GDP growth continues to disappoint, Moody’s ratings agency warns

The UK’s economic outlook has weakened as a result of the eurozone debt crisis, Moody’s has said in a fresh blow to the chancellor George Osborne.

The ratings agency cut its forecasts for GDP growth, after figures last week showed the UK economy shrank by 0.7% in the second quarter – far more than expected.

Moody’s expects GDP to grow by just 0.4% this year and 1.8% in 2013, which is considerably more optimistic than many economists, who expect the economy to contract this year. Gerard Lyons at Standard Chartered said after the GDP figures were published: “I think it’s inconceivable that there will be positive growth this year.”

Moody’s warned on Tuesday that Britain could lose its triple-A rating if economic growth did not meet expectations, and if the country’s debt burden increased. It said the weaker economic environment could challenge the government’s efforts to reduce debt in the coming years.

Read moreUK Economic Outlook Slumps – UK May Lose Triple-A Rating If GDP Growth Continues To Disappoint, Warns Moody’s