Rumors abound that Moody's Investors Service is reviewing for a possible downgrade of Italy's Aa2 local and foreign government bond
ratings according to Bloomberg News.
Moody's started looking into a possible downgrade of Italian bond ratings
on June 17, 2011. They were concerned about Italy's economic growth challenges, the risk surrounding plans that are required to reduce Italy's
debt and keep it at affordable -to pay- interest rates, and the risks of default with the constantly changing funding conditions for European sovereigns with high levels of debt, i.e. PIIGS issues.
So what does that mean? Italian debt is going to cost more in the short term and following Ireland, Spain Portugal, Cypress and Greece, my end up blowing up like Greece with unsustainable debt loads. America are you listening?
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