Moody's late yesterday slashed Portugal four levels to Ba2 from Baa1 with a negative outlook. The decision came two months after Portugal got a 78 billion-aid package ($112 billion) and hours before today's sale of 1 billion euros of treasury bills.

The sovereign debt crisis is not going away throwing money at the problem. The participation of the private sector in the Greek debt restructuring could impact Portugal ability to access the capital markets. The public sector had to save the private sector almost 3 years ago. Funny how after the huge transfer of money to the banks, governments now ask the private sector to step in and help them buy time. And time is getting more and more expensive as the crisis progresses and the effect of their injections of "trust in the system" are shorter and shorter. They look like an ostrich who does not want to raise its head from the hole. Almost pathetic are also ratings agencies that rise up championing the cause of "guardians of the markets" when they lost their credibility in the events that led to the crisis of 2008.


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