Thread: France Worries AAA Rating; UK Urge Greece to Abandon Euro

Monday, May 31, 2010

France Worries About AAA Rating; UK Economists Urge Greece to Abandon Euro; Spanish Prime Minister Losing Support; Japan’s Industrial Output Weakens

Inquiring minds might be interested in an international roundup for Memorial Day. Let's take a look at top stories about France, Germany, Greece, the EU, Spain, and Japan.

French Finance Minister Says "Keeping AAA Rating a Stretch"

As Eurozone trade unions prepare to battle over various austerity programs, the French budget minister warns on credit rating. http://www.reuters.com/article/idUSTRE64R35J20100531

France admitted on Sunday that keeping its top-notch credit rating would be "a stretch" without some tough budget decisions, following German hints that Berlin may resort to raising taxes to help bring down its deficit.

Euro zone trade unions are preparing for possible confrontations in the coming week if governments impose austerity measures or labor reforms unilaterally. But ministers made clear they were ready to take unpopular steps to prevent the Greek debt crisis spreading to their economies, although doubts are growing about whether the Spanish government in particular has enough support to get its way.

Budget Minister Francois Baroin indicated on Sunday that France should not take for granted its AAA rating, which allows Paris to borrow relatively cheaply on international markets and finance its big budget deficit.

"The objective of keeping the AAA rating is an objective that is a stretch, and it is an objective that, in fact, partly informs the economic policies we want to have," Baroin said. "We must maintain our AAA rating, reduce our debt to avoid being too dependent on the markets, and we must do this for the long term," he told Canal+ TV in an interview.

France has forecast its deficit will hit 8 percent of gross domestic product this year, but aims to bring it down to within the European Union's 3 percent limit by 2013.

UK Economists Advise Greece to Abandon the Euro

The Times Online reports Greece urged to give up euro http://business.timesonline.co.uk/tol/b ... 140270.ece

THE Greek government has been advised by British economists to leave the euro and default on its €300 billion (£255 billion) debt to save its economy.

The Centre for Economics and Business Research (CEBR), a London-based consultancy, has warned Greek ministers they will be unable to escape their debt trap without devaluing their own currency to boost exports. The only way this can happen is if Greece returns to its own currency.

Greece’s departure from the euro would prove disastrous for German and French banks, to which it owes billions of euros.

Doug McWilliams, chief executive of the CEBR called the move “virtually inevitableâ€

Have a hard time understanding why we pick on other countries.
Greece debt ratio is at 13% with Spain, Portugal, Italy, Ireland and Britain following right behind to no less than 11%.
I believe we're about 10% here in the US and we are a much bigger economy.

There are many in the Obama administration and in the Progressive Democrat party - that want Americans to believe that we are on the "road to recovery". Hillary Clinton was just out last week saying the rich need to be taxed more and more, even though the top 1% of earners pay 41% of the taxes.

These articles show that the economies in the EU are still in grave danger and have great potential to continue to wreak havoc on our own - and hence we need to vote in November to STOP the SPENDING - can REPEAL the awful Health Care bill (which is now estimated to cost over 1 Trillion).