The author has been described by News Ltd as an "iconoclast", "Svengali", a pollie's "economist muse", and "pungently accurate". Fairfax says he is a "Renaissance man" and "one of Australia’s most respected analysts." Stephen Koukoulas concludes that he is "85% right", and "would make a great Opposition leader." Terry McCrann claims the author thinks "‘nuance’ is a trendy village in the south of France", but can be "scintillating" when he thinks "clearly". The ACTU reckons he’s "an enigma wrapped in a Bloomberg terminal, wrapped in some apparently well-honed abs."

Tuesday, February 1, 2011

Why Australia is a better AAA-credit than the US, which is facing downgrades

Australian credit risk is 'sweet' man. Check out the charts below and this quote from Moody's (HT: FT Alphaville):

"Moody’s maintains a Aaa rating on the government bonds of the United States, with a stable outlook. This rating is based on a number of characteristics of the US economy, institutions, and government finance that together support a rating embodying the lowest level of risk to bondholders. However, recent trends in and the outlook for government financial metrics in particular indicate that the level of risk, while still small, is rising and likely to continue to rise in the next several years. Although no rating action is contemplated at this time, the time frame for possible future actions appears to be shortening, and the probability of assigning a negative outlook in the coming two years is rising."