A difference in reporting

Moody's Investors Services released a report on the financial position of major AAA rated governments and I was interested to read two rather different accounts of what it said. The financial specialists at Bloomberg reported the headline news as

"The U.S. and the U.K. have moved “substantially” closer to losing their AAA credit ratings as the cost of servicing their debt rose, according to Moody’s Investors Service.

The governments of the two economies must balance bringing down their debt burdens without damaging growth by removing fiscal stimulus too quickly, Pierre Cailleteau, managing director of sovereign risk at Moody’s in London, said in a telephone interview.

Under the ratings company’s so-called baseline scenario, the U.S. will spend more on debt service as a percentage of revenue this year than any other top-rated country except the U.K., and will be the biggest spender from 2011 to 2013, Moody’s said today in a report.

“We expect the situation to further deteriorate in terms of the key ratings metrics before they start stabilizing,” Cailleteau said. “This story is not going to stop at the end of the year. There is inertia in the deterioration of credit metrics.” "

However the BBC reported the news thus:

"The credit ratings of major AAA governments, including the US and the UK, are well positioned, says Moody's Investors Services.

Moody's released a report on the financial position of major AAA rated governments.

This includes the four largest - Germany, France, the UK and the US - as well as smaller ones, including Spain.

The report will reassure the bond markets about the ability of the US and the UK to make future debt payments.

A key finding is that the AAA ratings of the UK and the US are secure because of the capability of their respective governments to reverse recent deficits. "

Both accounts cannot be correct and I think I would rather believe the account of the unbiased Bloomberg than the pro-Labour spin of the BBC in the run-up to a general election.