The Moody’s agency cut Ireland’s credit rating Monday, citing the country’s swelling national debt, the unpredictable cost of its bank-bailout plans and its weak growth prospects for the next three to five years.
Shares on the Irish Stock Exchange slumped after Dietmar Hornung, Moody’s lead analyst for Ireland, announced that the New York-based agency was dropping its credit-worthiness rating one notch to Aa2. Moody’s previously cut Ireland’s rating to Aa1 from the top grade, Aaa, in July 2009 as Ireland plunged into its worst recession since the Great Depression of the 1930s.But but but but austerity fixes everything! Ireland's reducing its debt! Irish workers tightened their belts and the Irish government did along with them and cut spending!
And since nobody's buying anything, Ireland is now crashing into a deflationary spiral. That'll be us pretty damn soon if this path continues. Ireland has done exactly what the deficit hawks want us to do, and as a result their economy is imploding.
But Very Serious People want us to cut the deficit in the middle of a recession.
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