Posted by: Tom Keene on December 14, 2011
Since there are future events and developments that cannot be foreseen, the assignment of credit ratings is not an exact science. For this reason, Standard & Poor’s ratings opinions are not intended as guarantees of credit quality or as exact measures of the probability that a particular issuer or particular debt issue will default.
Credit Ratings Definitions & FAQs, standardandpoors.com
As if, a “particular issuer” might possibly be…the Republic de France. We are now at a point where so much blame has been allocated and mis-allocated that Sarkozy, Merkel et al should pray for advice from Jacob Bernoulli.
Bernoulli is featured in Peter Bernstein’s must-read Against the Gods and he, and it, deserves Europe’s full attention. “Hey! Mr. Finance Minister. Read Bernstein. It’s on me.”
It will come down to a coin toss.
We, and that includes me, have zero clue of the weighting and sequence of events to come. A coin toss will not be in order at each and every moment (or cross-moment, math joke). But there will an unguessable, exogenous shock, one single event, where a 50:50 toss will be in order. Grown-ups will attend as the adolescents age. No nuance, no shades of gray. No, on the one hand…
So, flip your sou, cent or centime and whisper…It’s not an exact science. Discuss.