French President Nicolas Sarkozy is widely expected to be kicked out of office in elections Sunday. If he goes, he’ll be in good company: Almost every crisis-hit European country that has held an election since disaster struck in 2009 has thrown out its leader.
Here’s a look at countries where political cadavers litter the landscape.
_ SPAIN: A burst real estate bubble also deflates faith in a Socialist government, which is nonetheless reluctant to admit Spain has problems. Blips of good economic news are seized upon as “green shoots” pointing to recovery. Wrong. Stimulus measures are enacted, then crushing austerity. Unemployment soars. The Socialists of Jose Luis Rodriguez Zapatero are wiped off the map in November 2011 elections; Mariano Rajoy’s conservatives take over.
_ ITALY: Silvio Berlusconi, the long-serving Teflon leader accused of everything from bedding escorts to serial corruption, finally bites the dust in November 2011. He resigns to cheers and jeers as investors lose confidence in his ability to spur economic growth and rein in debt. It’s the end of a political era. Mario Monti, a former European Commissioner, is named to replace him and lead a technical government until elections in 2013.
_ BRITAIN: Gordon Brown leads the Labour Party to defeat in the May 2010 election; Conservative Party leader David Cameron becomes leader of a coalition government. Brown had been finance chief for a decade before succeeding Tony Blair in 2007. Brown had boasted endlessly of ending the cycle of boom and bust _ but as prime minister he presided mostly over bust.
_ IRELAND: Brian Cowen, promoted to prime minister in 2008 after being finance minister, doesn’t even get to run. He resigns as leader of the Fianna Fail Party weeks before the February, 2011 election. It doesn’t help his party, which suffers its worst ever defeat. Cowen was finance minister during Ireland’s banking crisis and the collapse of its housing bubble.
_ GREECE: Greek Socialist leader George Papandreou swept to power in October 2009 over conservative opponents, pledging to spend his way out of a deteriorating economic situation. Two years later, at the height of Greece’s worst financial crisis since World War II, Papandreou’s own deputies force him out after he endangers a hard-won bailout by announcing he would put it to a referendum. He’s replaced by caretaker Prime Minister Lucas Papademos.
_ PORTUGAL: A month after Portugal requests a 78 billion-euro bailout, the center-left Socialist government of Jose Socrates is voted out of power in June, 2011. Portugal’s woes stemmed from a decade of feeble growth as it failed to modernize amid increasing global competition and dug itself deeper into debt.
_ DENMARK: A center-right government in Denmark loses power in September in part due to discontent over austerity measures introduced amid the debt crisis. It is replaced by a center-left coalition.
_ FINLAND: Finland’s government is reconfigured after June elections following a sharp surge in support for nationalists who oppose bailouts for debt-stricken eurozone countries. A conservative-led coalition spanning left and right is formed to keep the nationalist True Finns out of power.
Bucking the Trend:
_ ROMANIA: Romanian President Traian Basescu wins re-election in 2009, the year Romania’s economy shrinks by 7 percent and Romania takes a 20 billion-euro bailout loan from the International Monetary Fund, the World Bank and the European Union. Basescu, a former ship captain, prevails because he is seen as a strong leader in a time of crisis.
_ POLAND: This has been a rare European success story: It’s the only European Union country that did not to slip into recession during the global crisis of 2008-2009. Last fall the center-right party of Prime Minister Donald Tusk wins a second straight term in parliamentary elections, making history by becoming the first government since the fall of communism in Poland in 1989 to be re-elected.
_ ALSO: Sweden’s prime minister is re-elected in 2010 and the prime ministers of Latvia and Estonia are re-elected in 2011.
Cash advance loans and online payday loans available today. Apply now and receive up to $1500 no teletrack cash advance in as little as 1 hour, direct lenders.
The Senate on Wednesday passed a plan to save the struggling U.S. Postal Service, an effort that could save thousands of jobs and 100 mail processing plants now slated to be closed or consolidated next month.
In an unusual showing of bipartisanship, the Senate voted 62-37 to throw a lifeline to the indebted Postal Service. Without help, the Postal Service would otherwise cut Saturday service, delay mail delivery and close hundreds of postal processing plants and post offices, triggering thousands of job cuts nationwide.
"My hope is that our friends over in the U.S. House, given our bipartisan steps we took this week, will feel a sense of urgency," said Sen. Tom Carper, a Delaware Democrat, one of the Senate bill’s co-sponsors. "The situation is not hopeless, the situation is dire."
The House has yet to take up a different bill to reform the Postal Service. However, Rep. Darrell Issa, a key Republican on postal service legislation, called the Senate bill "wholly unacceptable," in a statement released Wednesday.
Congress faces a deadline of May 15, when a moratorium on postal closures expires.
The recession, declining mail volume and a congressional mandate to prefund retirement health care benefits have put the service in a bind. It reported a $5.1 billion loss for the year ended Sept. 30.
The Senate bill, offered by members in both parties, forces the Postal Service to ease off part of its plan to slow down the delivery of first-class mail, the kind of mail that most consumers use.
Postal Service: We need more junk mail
The bill makes controversial changes, including cuts to workers’ compensation benefits, as well as a transition from door-to-door delivery to curbside delivery in some areas, such as suburban neighborhoods.
The Senate bill also prevents the Postal Service from cutting Saturday delivery for two years, until the agency can prove such a cut is needed as a "last resort."
During debate on the postal bill the past two days, the Senate agreed to order the Postal Service to postpone the May 15 expiration of a moratorium on closures until the House passes a postal service bill.
The Senate also agreed to cap executive pay of high-ranking postal officials to that of Cabinet officials, $199,000 cheap credit report. (Postmaster General Patrick Donahoe made $384,000 last year.)
The cost of the Senate bill could prove a major sticking point with the House. The Congressional Budget Office says the bill would cost $33.6 billion over 10 years.
The tab comes from increased borrowing authority for the Postal Service, allowing it to borrow $11 billion more from Treasury. The Postal Service can currently borrow up to $15 billion, and has tapped $12 billion of that loan.
The other cost comes from elimination of regular billion-dollar payments, now required by law, to Treasury to pre-fund health care benefits for retirees. That $23 billion would ease financial pain for the Postal Service, but it also means less revenue to ease federal deficits.
Several Senate Republicans, including Sen. Bob Corker of Tennessee, said they voted against the bill, because it wasn’t paid for in an appropriate way.
Earlier this year, the Postal Service said it was doing away with overnight delivery of many kinds of first-class mail, opening the door for closing 223 mail processing plants at a cost of 35,000 jobs.
The Senate bill would force the Postal Service to maintain some one-day delivery of first-class mail, mostly for items mailed within the same processing area — saving 100 mail processing plants.
The Senate bill would also tap most of an estimated $10.9 billion overpayment in the Federal Employees Retirement System to pay down postal service debt and use up to $2 billion on buyout packages to entice long-time employees to retire.
Unions oppose the Senate bill, saying it doesn’t provide a good long-term business model.
"We are very disappointed that the Senate approved such a flawed bill, but we are determined to continue the fight for legislation that will provide a path to long-term viability for the Postal Service," said Fredric V. Rolando, president of the National Association of Letter Carriers.
The U.S. Postal Service is, by law, an "independent establishment" of the executive branch. The agency doesn’t normally use tax dollars for operations, except for its $12 billion loan from Treasury.
Complicated faxing techniques were always a source of worry as most loan types need an identity proof. But now with the advent of bad credit loans with no faxing, you can apply for payday loans online without much hassle on your part.
Stocks in the U.S. fell slightly at midday Thursday as investors weighed stronger corporate earnings against disappointing economic reports.
The Dow Jones industrial average fell 23 points to 13,010 at noon. The S&P 500 dropped 3 points to 1,382.
Morgan Stanley rose 1.4 percent after the bank trounced Wall Street’s earnings and revenue estimates. UnitedHealth Group Inc. rose 2.7 percent after reporting higher profits. EBay, Southwest Airlines and Bank of America also beat forecasts.
Stock indexes fell after two relatively weak economic reports came out mid-morning. An index of regional manufacturing compiled by the Philadelphia branch of the Federal Reserve dropped sharply, and the National Association of Realtors said home sales fell 2.6 percent last month.
Earlier, the Labor Department said applications for unemployment benefits dipped 2,000 to 386,000. When the number is above 375,000, investors take it as a sign that hiring isn’t strong enough to lower the unemployment rate.
“None of these (reports) were disastrous, but they’re not as strong as we like to see,” said Brian Lazorishak, a portfolio manager at Chase Investment Counsel in Charlottesville, Va. Still, he added, “We’ve had good numbers out of some companies, so maybe we have some room for upside here.”
In other trading, the Nasdaq composite index fell one point to 3,030.
On Wednesday, U.S. stocks fell on worries that European efforts to help governments there pay off their debt could hit new roadblocks bad credit personal loan lenders. The Bank of Spain had reported that bad loans at the country’s banks had hit an 18-year high.
Before the opening bell Thursday, investors were nervously watching a sale of new Spanish government bonds. The auction met with high demand, and more bonds were sold than expected. But yields rose anyway. The yield on Spanish 10-year notes rose to 5.87 percent, an increase of 0.06 percentage point.
European markets mostly fell. Spain’s IBEX index fell 2.4 percent, Greece’s main index 1.8 percent and France’s CAC-40 fell 2 percent.
In other corporate news, Tumi Holdings, a maker of high-end luggage, jumped 47 percent to $26.50 on its first day of trading.
The U.S.-listed shares of cell phone maker Nokia sank 3.6 percent after the Finnish company reported a loss for the first three months of the year and a 40 percent plunge in device sales. The company faces fierce competition from Apple’s iPhone and handset makers that use Google’s Android software.
Human Genome Sciences doubled to $14.31 after the company spurned a takeover offer from GlaxoSmithKline of $13 per share, saying it undervalues the company. The biotech drug maker, which produces the lupus treatment Benlysta, said it would consider other options including a sale of the company.
Plastics manufacturer Spartech Corp. reported a $2.3 million loss in the first fiscal quarter, driven by increased freight costs, corporate expenses and spending on repairs and maintenance.
Clayton-based Spartech lost $2.3 million, or 7 cents a share, in the quarter ended Feb. 4, compared to a profit of $1.0 million, or 3 cents a share, a year earlier.
The company’s business units include custom sheet and rollstock, packaging technologies and color and specialty compounds.
Net sales increased 20 percent to $281.8 million in the first quarter, driven by sales in the automotive sector, construction, and food packaging.
Spartech executives plan to hold an investors’ conference call Thursday at 10 a.m. to discuss the quarterly results.
A U.K. house-price index rose to a 19-month high in February as first-time buyers moved to beat the expiration of a property-tax exemption, according to the Royal Institution of Chartered Surveyors.
The gauge based on a survey by London-based RICS increased 3 points from the previous month to minus 13, the strongest reading since July 2010, it said in a statement today. Still, with the measure below zero, that indicates more surveyors saw price declines than gains last month.
The figures partly reflect Britons looking to take advantage of a two-year stamp-duty exemption for first-time buyers purchasing a home for less than 250,000 pounds ($390,800) before it ends on March 24. While such
India banned all cotton exports on Monday, causing U.S. cotton futures to surge and igniting fears of another jump in prices for cotton goods.
India decided to immediately impose the ban because it’s worried about a possible supply crunch in the country. One reason: India’s cotton exports may have overshot government targets last year, its Directorate General of Foreign Trade said in a statement.
U.S. cotton futures jumped 4.5% — the most allowed in a single day of trading — to 92.23 cents per pound following the news.
"This India development really caught the entire cotton industry and traders off guard because it came with no warning," said Phil Flynn, senior market and commodities analyst with PFG Best.
Starbucks wristbands created these jobs
Flynn said the market reaction to India’s move reflects concerns that it could start a new rise in cotton prices that mirrors last year’s rally.
Cotton prices hit an all-time high of $2.27 a pound last March due to a global supply crunch for the commodity.
Cotton clothing manufacturers responded to that steep price jump first by raising prices for consumers and eventually using less cotton and more blended fabrics such as poly-cotton.
Flynn said cotton prices cooled off toward the end of last year and reached as low as 84.35 cents a pound.
"We’re in March again. Could we potentially have another big rally like last March? Maybe," said Flynn. "A void in the supply chain from India’s action could cause a price spike."
It would be deja vu for consumers, too.
"Cotton clothing prices have been coming down since last year as supply caught up with demand. But that could change now," he said.
The battle of the bulge has been a big, fat failure for U.S. drugmakers. But that hasn’t stopped them from trying.
For nearly a century, scientists have struggled to make a diet pill that helps people lose weight without side effects that range from embarrassing digestive issues to dangerous heart problems.
But this week, federal health advisers endorsed the weight loss pill Qnexa even though the FDA previously rejected it over concerns that it can cause heart palpitations and birth defects if taken by pregnant women.
The vote of confidence raises hopes that the U.S. could approve its first anti-obesity drug in more than a decade. It also highlights how challenging it is to create a pill that fights fat in a variety of people without negative side effects.
“Having a drug for obesity would be like telling me you had a drug for the fever,” said Dr. Mitchell Roslin, chief of bariatric surgery at Northern Westchester Hospital in New York. “There can be millions of different reasons why someone is obese; it’s really a symptom of various underlying mechanisms.”
An effective and safe diet pill would be an easy sale in the U.S.: With more than 75 million obese adults, the nation’s obesity rate is nearing 35 percent. But the biggest problem in creating a weight-loss drug is that there’s no safe way to turn off one of the human body’s most fundamental directives.
For millions of years, humans have been programmed to consume calories and store them as energy, or fat. It’s this biological mechanism that makes it almost impossible to quickly lose weight by not eating. Cutting down on food instead sends stronger signals to the body to store more calories.
“Throughout most of human history calories were scarce and hard to get, so we have numerous natural defenses against starvation,” said Dr. David Katz of Yale University’s Prevention Research Center. “We have no defenses against overeating because we never needed them before.”
The drug industry has been on a nearly 100-year search for a drug that can help the body shed pounds. They’ve mostly failed to come up with an effective one and many of their experiments have proven fatal to patients:
_ Early attempts focused on speeding up metabolism to burn more calories. In the 1930s, doctors prescribed an industrial chemical called dinitrophenol, which accelerated metabolism, but also caused fever, swelling and deadly toxicity in some patients. The 1938 law establishing the Food and Drug Administration was a response to untested drugs like dinitrophenol.
_ In the `50s and `60s, amphetamines became a popular because they boost metabolism and suppress appetite. But the pills proved to be highly addictive, and doctors discovered they increase blood pressure and heart rate. The amphetamine phentermine remains approved for short-term weight loss, usually less than 12 weeks, though it is seldom prescribed because of the potential for addiction.
_ Perhaps the worst diet pill safety debacle came in the 1990s and involved the combination of phentermine and another weight loss drug marketed by Wyeth called fenfluramine. The combination of the two pills, dubbed fen-phen, was never approved by the FDA but more than 18 million prescriptions were written for it by the mid-90s.
But after studies in 1997 suggested that up to a third of patients taking fen-phen experienced heart valve damage, Wyeth was forced to recall two versions of fenfluramine and eventually paid more than $13 billion to settle tens of thousands of personal injury lawsuits.
_ In the last decade, drugmakers have moved toward other weight loss concoctions. Currently, the only drug approved for long-term weight loss in the U.S. is orlistat, which is sold as the prescription drug Xenical and over the counter as alli. The drug works by blocking the absorption of fat.
When launched in 2007, alli received a high-profile marketing push from drugmaker GlaxoSmithKline, complete with TV ads and a celebrity endorsement by country singer Wynonna Judd. But it never took off due to unpleasant side effects, including loose bowel movements. Educational pamphlets for alli even recommend people start the program when they have a few days off work, or bring an extra pair of pants to the office.
_ Most drugmakers now are focusing on medications that block brain signals associated with food craving and appetite. Vivus’ Qnexa is one of a trio of drugs seeking FDA approval. The diet pill, which was initially rejected due to the risks of heart palpitations and other safety issues, is a combination of two older drugs.
It uses amphetamine phentermine, which suppresses appetite. The other drug is topiramate, an anticonvulsant sold by Johnson & Johnson as Topamax. Topiramate is believed to make patients feel more satiated, though it’s unclear exactly how. J&J initially studied Topamax alone as a weight loss treatment but concluded the psychiatric side effects, such as memory loss and difficulty concentrating, were too significant.
Still, on Wednesday, a panel of FDA doctors and other advisers voted 20-2 in favor of approving Vivus’ Qnexa pill, which the drugmaker has resubmitted to the FDA for a second review.
The group touted the drug’s benefits, which include weight loss of nearly 10 percent for most patients taking the drug over a year _ the highest reduction reported with any recent diet pill. But panelists stressed that the drugmaker must be required to conduct a large, follow-up study of the pill’s effects on the heart.
The FDA is expected to issue its decision on Qnexa by mid-April.
“The potential benefits of this medication seem to trump the side effects,” said FDA panel member Dr. Kenneth Burman of the Washington Hospital Center in Washington DC. “But in truth, only time will tell.”
Tammy Wade of McCalla, Ala., is confident that the diet pill works. She lost nearly 40 pounds, dropping down to 167 while in a two-year Qnexa study.
“I never lost that much weight on any of the programs I’ve tried,” said Wade, who’s done everything from Weight Watchers to work out with a personal trainer.
McDonald’s extreme-green shamrock shake is going nationwide for the first time, the fast food franchise revealed on Wednesday.
The leprechaun-colored shake is currently available at every one of McDonald’s (, Fortune 500) 14,000 U.S. restaurants, according to company spokeswoman Ashlee Yingling.
The shamrock shake itself isn’t new. It’s been offered by McDonald’s restaurants at or around St. Patrick’s Day since 1970. But in the past, only certain restaurants offered the familiar green shake.
In its 42 years of existence, the shamrock shake has developed what McDonald’s refers to as a "cult-like" following among certain aficionados who prize its vivid-green hue.
So where does the shamrock shake gets its color? It’s basically a vanilla shake with mint flavor, said Yingling, and it gets the green hue from the syrup.
Like many of McDonald’s products, the shamrock shake once had its own mascot, named Uncle O’Grimacey, who appeared in commercials while singing a jaunty jingle about the shake.
O’Grimacey is an Irish version of the more well-known Grimace character, a rotund, purple creature of uncertain origin. O’Grimacey is green, of course, and unlike the naked Grimace, he wears clothes: a vest with shamrocks on it and a top hat of the sort worn by leprechauns.
But O’Grimacey won’t be pitching the shamrock shake this year.
"We will not be bringing back Uncle O’Grimacey or the jingle you referenced," said Yingling, when asked about his whereabouts.
KFC’s Double Down fails to take off
In fast food parlance, the shamrock is considered a "special" shake because of its exotic look and flavor. Not one to be outdone, the fast food franchise Jack in the Box () offers its own "special" drink: the bacon shake.
The bacon shake debuted on Feb. 2 and is only available for a limited time at certain restaurants, said Jack in the Box spokesman Brian Luscomb.
He said the bacon shake contains bacon-flavored syrup. But it contains no actual bacon, so it could actually be consumed by vegetarians, so long as they don’t mind milk products.
Denny’s to raise menu prices
The bacon shake also contains a lot of calories: 773 for a 16-ounce drink, according to Jack in the Box. That’s more than a 16-ounce shamrock shake, which contains 680 calories, according to McDonald’s.
But what did you expect? It’s a milk shake!
"Shakes are typically higher in fat and calories, but the bacon shake has about the same nutritional content as the other shakes," said the Luscomb, comparing it to other Jack in the Box products.
U.S. stocks ended mixed Thursday as investors digested a cautious economic outlook from the chairman of the Federal Reserve one day before a key report on the job market.
The Dow Jones industrial average () fell 11 points, or 0.1%, to end at 12,705. The S&P 500 () rose 1 points, or 0.1%, to 1,324. The Nasdaq () rose 11 points, or 0.4%, to 2,860.
"It’s a quiet day," said Paul Zemsky, head of multi-asset strategies at ING Investment Management. "The market is taking a pause before payrolls."
On Friday, the government is expected to report the U.S. economy added 130,000 jobs in January, according to economists surveyed by CNNMoney.
That would mark a sharp slowdown in hiring versus December, when 200,000 jobs were created. The unemployment rate is expected to rise to 8.6%.
Speaking before Congress Thursday, Fed chairman Ben Bernanke said the economy has shown some signs of improvement recently, but described the pace of the recovery as "frustratingly slow."
The sluggish recovery leaves the economy "vulnerable to shocks," including the debt crisis in Europe, the central bank chief added.
The comments raised speculation that the Fed is willing to take additional steps to support the economy if conditions deteriorate, said Doug Roberts, chief market strategist for Channel Capital Research.
"He’s saying that if things get worse, I’m available and we’re going to ease," said Roberts. "Clearly, he’s telling the market that if you decide to bet against me you’re going to get killed."
The Fed has purchased billions of dollars worth of Treasury bonds and other assets under its quantitative easing program. Some analysts say the Fed could hold a third round of asset purchases this year, depending on how the recovery progresses.
Europe: Where things stand
Meanwhile, investors remain on the lookout for an official agreement on a debt-reduction plan and second bailout for Greece. The deal is expected to come by the end of the week, though deadlines have been missed in the past.
U.S. stocks rose Wednesday, but closed off the highs of the day, on a combination of improved economic data and easing concerns about Europe’s debt crisis.
Economy: Initial jobless claims for the week ended Jan. 28 totaled 367,000, according to the government. They were expected to total 375,000, according to a survey of analysts by Briefing.com.
Data released Thursday morning from outplacement consulting firm Challenger, Gray & Christmas shows planned job cuts surged 28% in January to 53,486 — marking the highest total since 116,000 job cuts were announced in September.
The Challenger report follows data Wednesday from payroll processor ADP saying that the private sector added 170,000 jobs in January, down sharply from 292,000 in December.
Companies: Retailers reported better-than-expected same-store sales in January, according to data from sales-tracker Thomson Reuters.
Abercrombie & Fitch’s () stock fell 13% after the clothing retailer reported weak same-store sales for the latest quarter and lowered its earnings guidance.
Zynga () shares rallied 17% following Facebook’s IPO filing. Zynga’s gaming apps and advertising contributed about 12% of Facebook revenue last year.
Facebook IPO: Morgan Stanley is big winner
Sony () shares fell 6% after the company reported disappointing earnings and revenue.
Unilever () shares slumped 3.5% after the maker of Lipton teas, Dove soaps and other consumer products said it had difficulty passing higher raw material costs on to consumers last year, and announced a gloomy outlook for 2012.
Qualcomm (, Fortune 500), a company that sells chips used in cell phones, boosted its forecast for its 2012 performance. Shares rose 2%.
Viacom (, Fortune 500) shares fell after the media giant reported better-than-expected earnings in its fiscal first quarter, but cited ratings weakness and softness in the U.S. television advertising market. Its film division swung to an operating loss in the quarter.
Green Mountain Coffee Roasters () shares jumped 24% after the company reported its first-quarter revenue soared 102% compared to a year earlier, boosted by K-Cup sales.
World markets: European stocks closed modestly higher. Britain’s The DAX () in Germany added 0.6% and France’s CAC 40 () gained 0.3%. The FTSE 100 () in London ended little changed.
Asian markets ended higher. The Shanghai Composite () climbed 2%, the Hang Seng () in Hong Kong added 2% and Japan’s Nikkei () rose 0.8%.
Currencies and commodities: The dollar rose against the euro and the British pound, but fell versus the Japanese yen.
Oil for March delivery slipped $1.25 cents to end at $96.36 a barrel.
Gold futures for April delivery added $9.80 to $1,759.30 an ounce.
Bonds: The price on the benchmark 10-year U.S. Treasury fell, pushing the yield up to 1.85%.
French President Nicolas Sarkozy secured a small boost from Moody’s rating agency Monday following a bruising downgrade last week of the way the country had been handling its economy.
Moody’s said Monday it was maintaining France with a top AAA rating and stable outlook for its debt. Rival agency Standard & Poor’s, more downbeat about the prospects for France and Europe as a whole, stripped France of its long-cherished triple A rating last Friday.
In early trading, markets appeared to brush off S&P’s decision to cut the credit ratings of nine European countries, including France. Though the downgrades late Friday had been expected, they served as a reminder that the 17 countries that use the euro as their currency still have a long way to go to get a handle on the two-year debt crisis.
Europe’s economies will likely remain the focus of attention across markets all week as a number of bond auctions are due at the same time as Greece tries to clinch a debt-reduction deal with its private investors.
Sarkozy’s budget minister Valerie Pecresse said Monday she was optimistic that S&P’s knockdown would not lead to a rise in the country’s borrowing costs. A short-term French bond auction later on that day is seen as a test of the impact of the downgrade.
In its announcement, Moody’s cited the French economy’s overall strength but said bleak growth prospects in France and the region present “risks to the French government’s fiscal consolidation plans.”
Moody’s had said in October it was putting France on review, as Sarkozy and other European leaders struggled to find solutions to Europe’s protracted debt crisis.
Moody’s said Monday it “will update the market during the first quarter of 2012 as part of the initiative to revisit the overall architecture of our sovereign ratings in the EU.”
The rating agency detailed the strengths of the French economy, but noted that the country’s debt levels have deteriorated because of the “global economic and financial crisis” and were now among the weakest of all AAA countries.
“France, like other eurozone sovereigns, may face a number of challenges in the coming months. The need to provide additional support to other European sovereigns or to its own banking system cannot be excluded no teletrack payday loan. In that case this could give rise to significant new (contingent) liabilities for the government’s balance sheet,” Moody’s warned.
Moody’s notes the government has less room to maneuver than during the 2008 meltdown. “The domestic and external economic growth outlook presents significant risks to the French government’s fiscal consolidation plans.”
Sarkozy meets later Monday with Spain’s new Prime Minister, Mariano Rajoy, whose country was also downgraded Friday by S&P.
The S&P move was especially brutal for France, one of the world’s biggest economies and a financier of bailouts for smaller, poorer eurozone countries.
Sarkozy has yet to speak publicly about the downgrade, leaving his government ministers to try to calm the public.
Pecresse said on Europe-1 radio Monday that she doesn’t expect “mechanical consequences” of the downgrade because France has “credibility” and is a “sure value.”
She noted that the United States didn’t see its borrowing costs spike after last August’s decision by Standard & Poor’s to strip it of its AAA rating. Like France, the U.S. is rated AA+.
Pecresse and the prime minister promised to continue cost-cutting reforms, despite criticism from the left _ and S&P itself _ that austerity measures alone could crimp growth.
Sarkozy’s challengers for the presidency have seized on the downgrade as what they call evidence that his policies are wrong-headed and ineffective.
Sarkozy hasn’t announced his candidacy but is near certain to seek a second term in two-round elections in April and May. He trails Socialist Francois Hollande in polls and is facing increasing pressure from far-right candidate Marine Le Pen and a centrist, Francois Bayrou.
It will be a bruising battle for Sarkozy, a dynamic leader who has a strong international profile but is widely disliked at home. Leftists say he has coddled the rich, while many of those who supported him in his 2007 campaign say he hasn’t fulfilled his promises.
Powered by WordPress -- XHTML 1.0