主题：【原创】新年政治经济展望之四：金融资本（一） -- 井底望天

http://v3.moodys.com/researchandratings/methodology/003006001/rating-methodologies/methodology/003006001/4294966628/4294966848/0/0/-/0/rr

http://www.moodys.com.br/brasil/pdf/SovGuide2006.pdf

Sovereign rating manual of Moody's

I think S&P posted similar documents online.

I am expert on corporate issue rating, not expert on Sovereign ratings. But some general principles will apply.

1.annual deficit (just like corporate profitability ratio)

2.accumulated debt deflated by total assets or total revenue (here it is debt/GDP ratio since gov. does not provide balance sheet asset info).

3.debt currency issue (foreign currency issue rating is ALWAYS LOWER than domestic currency issue--because of many foreign buyers)

US deficit ratio is as bad as Greece (both around 12%, 11% for Portugal and 9.3% for Spain. Italy is safest, 5.5%), but US public debt/GDP ratio is only 54%, while Greece is around 125%(if you still believe its revised ratio from its highly corrupted statistics department--Greece is worse than China in its public administration).

Both US/Greek government debts are mainly sold to foreigners (Greece has been like that for many years, US has 70% debts sold to Chinese and Japanese since 2003). But US has the credibility of safe haven that Greece does not have. During 2008 financial crisis, all global capital flooded into American gov. bonds and for a while, the implicit interest rate is even negative...

US still has the global reserve currency status, which allows it to use printing press to temporarily solve its problem. Greece does not have that capability yet.

能解释一下为啥PIGS国债降级，而国债远超GDP的日本却没被降级吗？

--2009 Japan gov. deficit=1% of GDP.

--I remember Debt/GDP ratios are 200%(Japan), 125%(Greece), 120%(Italy), 80%(Portugal), 55%(Spain--much better than all Latin peers, only drawback is the deficit and loss of competitiveness). Japan has high saving rate while all those Latin European nations have little domestic savings (they know how to enjoy life--Joie de vivre). When you have your debt in your currency and most buyers are your nationals, your rating will be better.

日本却没被降级吗？

--I remember one rater actually downgraded Japan and other 2 put Japan under negative watch for downgrades. Keep in mind, there are three raters: S&P, Moody's and Fitch. They do not act together.

是不是政治因素也是评级的依据之一？

--Political stability FOR SURE is a major rating factor. That's why Ukraine's rating is always bad--the PM just resigned after losing a political fight and the gov. still has no budget for the new year. Same problem for Argentina.

--In terms of US rating of "AAA", actually it is not just for USA. Canada/Germany/US now all enjoy AAA ratings. Canada/Germany deserve that though both nations ran higher deficit in 2009 (3% and 5.5% respectively). US has one-time deficit of 12%. US still has a low debt/GDP ratio (54%, lower than Canada), but this ratio is going up quickly under lavish budgets of the Obama administration.

If we look at long-term prospect--given the Obama high deficit plans for next 10 years, US might lose the AAA rating soon. Moody's has warned US gov. publicly.

BTW, 90% is the threshold for Debt/GDP ratio based on Carmen Reinhart study. After that, one nation became very vulnerable and the debt service cost will signficantly weaken the public finance of that nation.

America is marching towards that danger zone under our great blah-blah promiser leader Hussein Obama.