Fitch issues negative rating outlook for U.S.A.

Fitch revised the U.S. AAA rating from stable to negative. Clearly, U.S.A. should get downgraded as its debt to GDP is approaching 150% of GDP.

Greece rating finally cut to junk

Today Moody's finally cut Greece to the C rating. And C is the lowest rating there is.

This is their definition of ratings:

• Aaa Obligations rated Aaa are judged to be of the highest quality, with minimal credit risk.
• Aa Obligations rated Aa are judged to be of high quality and are subject to very low credit risk.
• A Obligations rated A are considered upper-medium grade and are subject to low credit risk.
• Baa Obligations rated Baa are subject to moderate credit risk. They are considered medium grade and as such may possess certain speculative characteristics.
• Ba Obligations rated Ba are judged to have speculative elements and are subject to substantial credit risk.
• B Obligations rated B are considered speculative and are subject to high credit risk.
• Caa Obligations rated Caa are judged to be of poor standing and are subject to very high credit risk.
• Ca Obligations rated Ca are highly speculative and are likely in, or very near, default, with some prospect of recovery of principal and interest.
• C Obligations rated C are the lowest rated class and are typically in default, with little prospect for recovery of principal or interest.

So finally we are at the point that we are saved from all the BS from at least 1 rating agency Moody's, as C is the lowest rating. We are all fed up with these meaningless rating cuts from these redundant rating firms. Greece is bankrupt, case closed...

We still have Fitch (credit rating C, still to be downgraded to D), Standard and Poor's (sovereign rating: SD selective default, still to be downgraded to D (full default on due date)). If these two eventually downgrade Greece again, life will finally go on without this redundant, meaningless news.

Meanwhile, Greece's 10 year government bond yields continue to move up. If we do know they are going to default at least by 90%. Then yields are still much too low at this stage.:

Greece 10 Yr Government Bond Yields (%)

Belgium Downgraded by Fitch

Today Belgium was downgraded by Fitch from AA+ to AA with negative outlook. All of this due to the Dexia fiasco. I'm from Belgium and I can say that the bailout of Dexia was the most immoral thing the government has ever done. Dexia has an enormous amount of Greek debt (US$5 billion write down)  and everyone knows Greece is going to default sooner than later. Supporting Dexia was the dumbest act ever. The only reason why Belgium government bonds are doing well is because Belgians have an enormous amount of savings and the unemployment rate is improving.

But we see the consequences already from Dexia. Several cantons lost several millions of money. Of course, we tax payers will need to pay for this.

Amount of shares in Dexia per capita

4 other countries were downgraded as well:

Italy: A => A-
Spain: AA- => A
Cyprus: BBB => BBB-
Slovenia: AA- => A

Surprisingly, the euro went up...