Could something similar happen to Pervez Musharraf?
Andrew Leonard Nov. 05, 2007 | While police were clubbing down protesters in the streets of Karachi Monday, Moody’s Investors Service announced that Pakistan’s “credit rating” had been placed “under review.” We don’t yet know how President Pervez Musharraf reacted to this dour expression of market disapproval. Earlier this summer, on the same day Musharraf ordered an assault on religious militants holed up in the Red Mosque, Standard & Poor’s lowered its outlook for Pakistan’s credit rating from “positive” to “stable,” and in late September, the price of insurance against Pakistan defaulting on its own bonds shot up. But neither signal from international investors that they were unhappy with the direction of events in Pakistan appears to have made an impression on the military dictator. So what does it mean when a country’s “sovereign” credit rating gets downgraded? We’ve seen, as the subprime drama rolls along, that decisions by ratings agencies can have immense downstream effects. Th
