Magazine February 6, 2012, Issue

Grade School

A machine sorts euro notes at the Belgian Central Bank in Brussels, December 21, 2001. (Thierry Roge/Reuters)
Rating agencies certify the euro zone’s parlous state

When watching a disaster movie it’s occasionally worth pausing to take stock of where the main drama, obscured by subplots, rubble, and confusion, really stands.

Standard & Poor’s announcement, on, suitably, Friday the 13th, that it had downgraded nine euro-zone countries in various disapproving ways was a chance for just such a moment. S&P’s stripping France and Austria of their highly prized triple-A ratings grabbed the headlines. The downgrades of less-than-€’Black Card nations such as Cyprus, Italy, and Spain (each down two notches, to BB+, BBB+, and A, respectively) added the clickety-click of tumbling dominoes to the story. But most striking

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