Is Britain Bankrupt? Will the UK Loose its AAA Rating?

By Global Research
Global Research, January 20, 2009
George Washington Blog 20 January 2009

Url of this article:
https://www.globalresearch.ca/is-britain-bankrupt-will-the-uk-loose-its-aaa-rating/11915

First Greece and Spain lost their AAA sovereign credit rating.

Now, Bloomberg notes:

“The U.K. government may lose its top AAA credit rating after taking a 70 percent stake in Royal Bank of Scotland Group Plc, credit-default swaps show.”

Indeed, as the Financial Times writes:

The cost of buying credit protection for the sovereign debts of the UK, US, Ireland, Spain, Austria and Germany all hit fresh highs on Tuesday morning.***

The cost of buying five-year credit protection on the UK gapped wider to 133bp on Tuesday, compared to Monday’s close at 124.9bp. Ireland was out at 281bp from 275.2bp yesterday, Spain was at 156.3bp, compared to 142.5bp, Austria climbed to 157.5bp from 146bp

Remember, this chart from December, showing one-month in credit default swaps bet against countries?

Well, Spain – which was the 11th biggest CDS target on the list, 7 places better than the UK – has already been downgraded. The UK is the 4th biggest target (right behind Greece and slightly ahead of Iceland, both of which have already been downgraded).

So a downgrade of the sovereign credit rating of the UK would be logical.

Source: http://georgewashington2.blogspot.com/2009/01/will-uk-lose-its-aaa-credit-rating.html

Disclaimer: The contents of this article are of sole responsibility of the author(s). The Centre for Research on Globalization will not be responsible for any inaccurate or incorrect statement in this article.