Link: http://www.telegraph.co.uk/finance/financialcrisis/8619228/Moodys-downgrades-Portuguese-debt-to-junk.html

Moody's downgrades Portuguese debt to junk

Portugal's debt has been consigned to junk territory after Moody's slashed its credit rating on the view that a second international bail-out will be needed.

By Louise Armitstead

9:01PM BST 05 Jul 2011

In a move that will alarm traders, the rating agency cut Portugal's credit rating by four notches to Ba2 saying it would not be able to borrow in the capital markets by 2013 as planned.

International banks are meeting in Paris on Wednesday in an effort to salvage talks with European regulators over sharing the cost of bailing out Greece.

The lenders will debate a plan that will be more advantageous to Greece than the proposals put forward by French banks to roll over 70pc of debt maturing by the end of 2014. The new deal could include rolling over more debt and lowering the interest rates even further.

The meeting, which will be chaired by the Institute of International Finance, follows Standard & Poor's verdict that the French plans would constitute a default. European authorities are determined for Greece to avoid an official default but still want private creditors to share the costs of bailing out the shattered economy.

Greece has €82.6bn (£74.2bn) of government bonds maturing before the end of 2014. European banks hold about €25bn of this.

Comment:

What is the definition of insanity?

Doing the same thing over, and expecting a different result!

Good Luck to all!