Monday, August 23, 2010

France and the Ratings Agencies

Nicolas Sarkozy recently called an emergency meeting of his economic team to deal with the perceived threat of a downgrade of French sovereign debt by ratings agencies, especially Moody's. But why? Paul Krugman notes that eight years after Japan was downgraded, it can still borrow at 1 percent. Economic policy should not be guided by fear of the ratings agencies' wrath.

No comments: