Moody’s Fears Coming Debt Crash in Europe Will Outdo 2008

Nov. 19, 2019 (EIRNS)—Picking on the IIF report on the threat of explosion of the corporate debt bubble, Britain’s Daily Telegraph today quotes Moody’s analysts who say that Europe will be struck by an even larger wave of debt defaults in the next downturn compared to the 2008 financial crisis.

“The credit ratings agency warned that the proportion of B3-rated companies, those graded as ‘speculative’ quality, has doubled in Europe over just three years. The deterioration means the region will see ‘a much larger number of downgrades and defaults during the next cyclical downturn compared with the crisis in 2008-09,’ Moody’s said.”

“Egor Nikishin, an analyst at Moody’s, said a ‘less benign part’ of the economic cycle would raise doubts about the companies’ debt loads and their ability to generate cash.”