Reply #13: First US, Now Japan: S&P Revises Japan Credit AA- Outlook To Negative [View All]

[Pale Blue Dot]

S&P revises Japan's AA- credit rating outlook to negative. The culprit: the Japan earthquake that just as predicted, has become the scapegoat to excuse another quarter of "non-recurring" EPS misses. And while according to Wall Street the economic devastation is GDP positive, Japan may soon be a single A credit, which of course will send it 10 year bond trading with a 0 yield handle.

Overview

*Standard & Poor's expects costs related to the March 11, 2011, earthquake, tsunami, and nuclear power plant disaster will increase Japan's fiscal deficits above prior estimates by a cumulative 3.7% of GDP through 2013.
*We revised the outlook on the long-term rating on Japan to negative to reflect the potential for a downgrade if fiscal deterioration materially exceeds these estimates in the absence of greater fiscal consolidation.
*We affirmed our long- and short-term sovereign credit ratings on Japan at 'AA-' and 'A-1+', respectively.

http://www.zerohedge.com/article/first-us-now-japan-sp-revises-japan-credit-aa-outlook-negative