Final Word from Monday, January 16, 2012



It's a peculiarity of life that we live it going forward but can only evaluate it lookingbackward. Credit-rating agencies try to fool this process by telling us what willhappen in the future, but without fully admitting how much their own behavior inthe past predetermines this future. If the rating agencies had downgraded Franceand Austria years ago, when the risk of overindebtedness first started to build, thesecountries might not be in such a difficult position today. Czechs risk feeling smugthat Standard & Poor's didn't downgrade their own country's credit rating on Fri.(and in fact boosted it by two notches over the summer). Instead of seeing this asconfirmation of the cabinet's policy of "budget responsibility," Czechs should perhapsask why their country's credit rating is holding up so well. How is this possible whenthe national debt keeps rising rapidly, even in years of respectable economic growth?

Glossary of difficult words

downgrade - a reduction to a lower grade, rank or level of importance;

peculiarity - an odd or unusual feature or habit;

smug - having or showing excessive pride in oneself or one's achievements;

notch - a point or degree in a scale;

to hold up (well) - to remain strong or vigorous.

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