90 at 9: Marac and South Canterbury cut to junk; US retail sales weak; Bond auction strong

Bernard Hickey details the key news overnight in 90 seconds at 9am in association with ASB, including news that Standard and Poor's has downgraded both Marac Finance and South Canterbury Finance from BBB- or investment grade to BB+ or junk. Standard and Poor's was worried about their exposure to the property markets and and also about South Canterbury's exposure to related party loans to South Canterbury's owner Allan Hubbard.

Both Marac and South Canterbury are now looking to raise capital simply to stave off further downgrades. This is a problem for the government which has guaranteed deposits with them until October 2010 at the earliest. The finance companies need to fix their balance sheets and credit ratings before October next year or trustees and directors should consider folding to ensure depositers are paid. The government may have to extend the scheme.

Meanwhile a US bond auction was strong after weak retail sales, Bloomberg reported and German and French GDP rose surprisingly, the FT reported.

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[bellpawt]

Bernard is the only one to inform us of the beginning of the financial meltdown in New Zealand .Here it is folks -deleveraging -for us NZer`s .The plug has been pulled ..and down the gurgler we go .

[bellpawt]

Is NZ  kucfde ?