Thursday, December 27, 2007
And the Dow went up? Hello? Wake up fools!
Nearly 180,000 US local councils were placed on credit watch, with the credit agency Fitch releasing another $US5.3 billion in credit downgrades involving 27 mortgage companies. The news emerged on Friday night, when the nation's newspapers, even if they were following the story, would miss it. That one company could downgrade 27 major financial institutions in one stroke is stunning, but it follows a swathe of credit downgrades that swept the US on Thursday and Friday. There has been a major falling out between mortgage insurers, credit rating companies, banks and mortgage institutions, which believed their loans were insured, only to be stunned to find themselves booted into the mire that is American banking.