UK at Risk of Ratings Upgrade

Kennyboy66

macaque wrote: »

:

Imagine my neighbour comes to me for a loan of £100 and promises to pay me back £102 in 12 months time.

But what would you do in the scenario where you have to lend the money to someone.

Do you lend it to;

1) your neighbour
2) a similar bloke in France
3) ditto Italy or Spain
4) Put it on deposit in the Co-op

and maybe why most retail investors should avoid gilts.

antrobus

Generali wrote: »

Look at the inflation records of Switzerland and the UK over the last 50 years and then tell me which you'd rather lend to at a fixed interest rate.

Theoretically, I would say that the markets have considered that question and concluded that they are indifferent as to which country they lend to, and believe that the 2% premium on UK debt is sufficient to outweigh the increased inflation risk.

Gangaweed

Labour has not finished the job yet.

Just wait till they get back into power.

Thrugelmir

Gangaweed wrote: »

Labour has not finished the job yet.

Just wait till they get back into power.

Maybe a while yet. Noticeable how Labour are avoiding talking about the economy.........

The Coalitions version of austerity is working (currently).

tomterm8

Yorkie1 wrote: »

Why would an upgrade be a 'risk' to the UK economy?

Have you seen how good some of the credit ratings agencies are at predicting disaster?

If they uprate the UK, I'm buying the tinfoil.

antrobus

Gangaweed wrote: »

Labour has not finished the job yet.

Just wait till they get back into power.

I suppose you're right, Labour didn't quite manage to finish the job of driving the country to rack and ruin last time round. As a result, I imagine that are a number of people who hope that there will be quite a long "wait" before they get another chance.

Loughton_Monkey

Thrugelmir wrote: »

........Noticeable how Labour are avoiding talking about the economy..........

What?

Didn't you listen to Ballsie in his response to the Autumn statement?

........ oh! Sorry! you're right......

purch

Generali wrote: »

They do happen quite often further down the food chain but an upgrade to AAA is rare I believe, not that I'm a watcher of credit ratings as a rule.

As was a downgrade also, until quite recently.

Most AAA's were basically acquired rights when these things were invented, and you have had to be very naughty to lose that right.

Unfortunately over the last decade and a half there have been lots of countries/institutions/banks who have been made to sit in the naughty chair.