The rating agency Moody’s has taken the first step toward, downgrading the outlook for the three triple A rated Euro Zone countries i.e. Germany, Netherlands and Luxembourg , from stable to Negative. This decision was announced in the backdrop of the intensifying recession in the Zone.
The increased possibility of Greece leaving the Euro zone and Spanish problems multiplying, have prompted the Moody’s to go in for this decision. It is only a day back; the Greece Prime minister is describing the woes of his country, similar as to that of the U.S.A during the Great depression of the 1930’s. If alone Greece has to leave the Euro Zone that would put the Billions of Euro’s it owes to the German banks and bond holders at peril. Intensifying Spanish woes too demand, many more billion Euro’s of bailout money.
Already Greece, Ireland and Portugal were paid for with the bailout funds by the co-Euro Zone countries. Greater part of the monies for these bailouts was raised from the Germany, which is the biggest Euro Zone economy. But, of late the German economy too is showing signs of stress and strain, as a result of the intensifying global economic crisis and the consequent impact on its exports.
