Eurozone, Sovereign Ratings and Bond Yields

This column explains how and why sovereign ratings and bond yields failed to anticipate the Eurozone debt crisis. It also argues that, paradoxically, sovereign ratings are now valuable risk indicators Continue ReadingEurozone, Sovereign Ratings and Bond Yields

Government Credit Crisis Over – So Where are the Upgrades

The sovereign and municipal debt crisis of the early 2010s is finished. Overblown predictions of a credit meltdown among European sovereigns, US states and cities, and other advanced economy governments Continue ReadingGovernment Credit Crisis Over – So Where are the Upgrades

Is the Eurozone Debt Crisis Over? The View from Moody’s

Table 1

Regulation (EU) no. 462/2013 of the European Parliament and of the Council of 21 May 2013 requires credit rating agencies to publish a calendar of their sovereign and subsovereign rating Continue ReadingIs the Eurozone Debt Crisis Over? The View from Moody’s

Entire Financial System Needs Commonsense Review of Derivative Contracts: Let’s Start with ABS

Wikirating is publishing two letters and one e-mail in which I map risks to an asset-backed security (ABS) when the issuer is party to a swap contract, a widely used Continue ReadingEntire Financial System Needs Commonsense Review of Derivative Contracts: Let’s Start with ABS

Understanding CoCo Bonds: A New Source of Systemic Risk

CoCo Bonds

Since the 2008 financial crisis, regulators, policymakers and the “too big to fail” (TBTF) banks around the world have been developing new ways to resolve insolvent TBTF banks without the Continue ReadingUnderstanding CoCo Bonds: A New Source of Systemic Risk

Puerto Rico Rating Downgrades: Enron Redux?

On November 28, 2001 Enron lost its investment grade credit rating. Four days later, the company filed for bankruptcy. Those awaiting a similar collapse after Puerto Rico’s descent into junk Continue ReadingPuerto Rico Rating Downgrades: Enron Redux?