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Fitch Ratings Agency Downgrades Eurozone Countries

January 31st, 2012

Following in the wake of a string of downgrades of the Eurozone, including S & P cuttings its rating on France, Fitch has joined in with its own updated list of woes. Italy, Spain, Belgium, Slovenia and Cyprus have had their sovereign debt ratings cut by Fitch, just before the most recent Eurozone emergency leaders summit on the sovereign debt crisis. It seems surreal that the most recent emergency meeting is on the topic of “economic growth,” just as more quarterly results show  negative growth from various Eurozone members.

It is unlikely that the increased rhetoric emanating form the mouths of European politicians that their monetary bloc is just on the cusp of a new wave of economic growth will impress the ratings agencies. The question then is this; who will investors trust? Will it be the ratings agencies, which are falling all over each other in their ratings cuts and negative outlook with respect to the Eurozone, or will they place their bets on European politicians, who so far are batting a big fat zero in all their multitude of prognostications on the trajectory of the global economic crisis? I suspect the answer will not surprise many.



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