Last week, CMA published a report showing that despite Britain apparently retaining its Triple AAA rating, the market had in fact marked us down to –aa.
Yesterday Standard and Poor downgraded Greece’s credit rating to ‘Junk’, the lowest possible rating. Simultaneously there was a widespread stock market sell-off.
“The investors will go from Greece, to Portugal, Ireland, Spain and then will move to the UK. They will move to where they perceive the weakness to be.
“We have a budget deficit as a per cent of our economy that is not to different from Greece, so the situation is spreading.”
He added that it was a “mystery” to him “why Britain has a triple A credit rating: “We have got a budget deficit that’s 12 per centof GDP our debt is doubling.
“It is escalating and I think the financial markets have already taken things into their own hands they are actually pricing in a downgrading of our credit rating anyway. ”
“It is very similar to what has been happening to the banks. It is the first real test for the Euro zone. If we let Greece go, then what is next?”
In the middle of what should have been major headlines detailing the financial crisis forecast for Britain if we didn’t take substantive steps to cut Britain’s debt, and not just the deficit, we have Brown’s Bigot gaffe dominating the head lines.
In order to believe that this is purely coincidental, we must assume that Sue Nye, who has been at Gordon’s side for 13 years, introduced him to his wife, and is by all accounts his most trusted employee, suddenly took leave of her senses and pushed a real live member of the pubic in front of Gordon, without grilling her first as to her beliefs.
The fact that Sue Nye is married to Gavyn Davies, a former Goldman Sachs partner, who would have been fully aware of the blackening cloud of financial realism hanging over the day’s news, must not be allowed to colour our judgement.
While Goldman’s links to the UK government are not as extensive as those in the US, there are still significant connections. Goldman’s former chief economist and senior partner, Gavyn Davies, is married to one of Gordon Brown’s most trusted senior advisers, Sue Nye.
We must also assume that the micro management team that surrounds Gordon were entirely unaware that just a short hour beforehand they had wired him up to a live feed going out to all the journalists, and were not on hand to warn him with a glance or a gesture that he was still ‘live’.
We must even assume that Gordon had a spare 45 minutes in his busy schedule to allow him to go back and apologise to Mrs Duffy for her non-bigoted and entirely innocent question as to where Eastern European’s came from.
I have really tried to ignore the reality and believe that an experienced team just happened to allow Gordon to make a gaffe at a time when it was most useful to bury bad news.
I’m not having a lot of success.
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