Baa1 humbug!

Those prescient intellectual giants at Moody's Investor Service have today lowered Ireland's sovereign debt rating by five notches, to Baa1.

Now some uncharitable folk might think that cutting the rating so drastically, AFTER Ireland has been forced into accepting a massive international bailout, must mean that Moody's analysts haven't been paying attention. That's not the case at all. The much simpler truth is that Moody's, together with all the other rating agencies, is completely useless. The fact that they are able to continue charging people for their "services" after their sub-abysmal performance during the financial crisis is one of the mysteries of the age.

And since I'm in an unseasonably mean mood, how about a little pearl of wisdom from the UK government-sponsored "watchdog", Consumer Focus (CF)? Power prices in the UK are to be boosted* in order to finance replacement of outdated generating capacity, prompting CF to opine thusly:

Consumer Focus, the energy watchdog, said: “Consumers can’t be expected to write a blank cheque to fund this. A balance must be found on how this is funded between government, energy customers and the industry.”

I can only assume that CF has been taking economics lessons from its granny, because it's hard to think of anyone else who might believe that government and the industry have sources of financing that are in some way independent of the consumer. Unless, of course, CF is expecting Ben Bernanke to pass by with his helicopter.

* Supposedly electricity prices will double by 2030, which sounds scary but is in fact a compound rate of only 3.5% a year. If any electricity supplier is prepared to offer me that deal right now, I'll sign up for it immediately.