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Economy
S&P cuts Italy ratings
2011-09-20
Sept 20 (Reuters) - Standard and Poor's downgraded its unsolicited ratings on Italy by one notch to A/A-1 and kept its outlook on negative, a major surprise that threatens to add to concerns of contagion in the debt-stressed euro zone.

S&P said the cut reflected its view of Italy's weakening economic growth prospects.

Italy's fragile governing coalition and policy differences within parliament will likely limit the government's ability to respond decisively to the challenging domestic and external macroeconomic environment, the agency said.

"In our opinion, the measures included in and the implementation timeline of Italy's National Reform Plan will likely do little to boost Italy's economic performance, particularly against the backdrop of tightening financial conditions and the government's fiscal austerity program," said S&P.

The move from S&P came as a surprise as the market had thought Moody's was more likely to downgrade Italy first. Moody's last week said it would take another month to decide on its action.
Posted by:Steve White

#8  I think Marx never understood anything.

Even the simplest reading of Game-theory explains why the tyrant always rules in non-moral i.e. non-capitalist countries.

Even the simplest reading of comparative advantage explains why Marxist economies do not create value.
Posted by: Bright Pebbles   2011-09-20 10:18  

#7  Keynes like Marx believed in the perfectability of man. The issues were always theological/meta-physical/psychological rather than economic.

There never has been nor never will be a "new communist man".
Posted by: AlanC   2011-09-20 09:33  

#6  Glenmore, John Howard did.

His government paid back around 100 billion and left Australia (federal government) debt free. Which scaled up to the US economy would equate to 1.2 trillion.

Of course the current Labor government is busy squandering this.
Posted by: phil_b   2011-09-20 09:13  

#5  Keynes ignored human history that politicians would never be motivated to 'pay down' the debt. Using outliers to justify the general rule doesn't make for practical application.
Posted by: Procopius2k   2011-09-20 06:39  

#4  Tough to fault Keynes - no governement EVER adopted the second half of Keynsianism - pay down the debt in good times.
Posted by: Glenmore   2011-09-20 06:10  

#3  "But we are now at the end of the debt fuelled growth road for most governments."

Yay! Keynes is dead!
(curse the idiot)
Posted by: newc   2011-09-20 04:41  

#2  Government tax revenues are disproportionately marginal.

What this means is that tax revenues fall faster than incomes and asset prices.

And the reason they desperately try to 'stimulate' the economy using more debt.

But we are now at the end of the debt fuelled growth road for most governments.
Posted by: phil_b   2011-09-20 01:02  

#1  
Posted by: gr(o)mgoru   2011-09-20 00:46  

00:00