March 29, 2011
The euro-zone is getting another kick in the shins, this time from ratings agency Standard & Poor’s.
S&P downgraded its rating on Greece’s long-term debt two notches to BB- from BB+, pushing the nation’s debt deeper into the junk zone. Meantime, it trimmed Portugal’s rating to BBB- from BBB, placing Lisbon’s long-term debt rating at the lowest possible investment-grade level.
The ratings agency said it was “highly likely” that Greece will remain in need of assistance after 2013, by which time the Eurocrats are expected to have a new rescue fund in place. The view is that rescues post-2013 will require bondholders to accept losses, which S&P tartly calls “detrimental” to bondholders. Duh.
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