Standard and Poors upset a lot of people with their downgrades of 9 euro-zone countries this week. The problem is, they are still playing catch up. Having done this sort of country risk assessment in the past, I know how hard it is to stay ahead of the game but, given that S&P and their competitors are paid handsomely for this work, their performance with respect to timing and consistency has been woeful for years . All the clever money will have discounted this ‘news’ weeks ago. In the end, the new rating means there is a slight risk that France will default but, let’s face it, before it comes to that a lot of other bad things would have happened further south and the last thing we’ll be caring about is the credit rating. Hopefully, the downgrades will spur EU leaders into decisive, confidence restoring action…. in which case they are to be welcomed, but don’t hold your breath.
Meanwhile, some Brits are getting all excited about the possibility of the UK breaking up after a Scottish referendum on independence. My main comment would be – wake up people of these islands to what the ruling elite is foisting on us… at this time of economic crisis, the last thing we need is a digression into costly constitutional change. We should be working more closely together to sort out our path forward as a co-operative and competitive economy, not diverting analytical and political effort and hard-earned cash into adding more bureaucratic layers of government and economic inefficiencies across these islands.
Few parties come out of a messy and acrimonious divorce better off than when they went in. Please remember that as the Salmonds and Camerons of this world, backed by an excited media, try to work us up into a frenzy. I am more worried about the reactionary forces at work that are undermining the long term living standards of the majority of the British people. The Coalition, bit by bit, is destroying the trust between people and government through a range of proposals and actions to destroy the economic assumptions on which many of us have planned our futures. These acts of fraud are cruel and will permanently damage the economic resilience of the United Kingdom. That’s where the attention of the ‘people’ and media should be at this time. Dividing the people into tribes, allowing elites to capture the spoils of ending the union, will only make that worse….