In another blow to the euro-zone, Moody's cut the sovereign debt rating of Ireland from Aa1 to Aa2, almost exactly one year after it initially cut the island nation's rating from the top grade, Aaa.
The Irish National Treasury Management Agency, which is is responsible for the nation's sovereign debt, put a brave face on things. They pointed out that Moody's now rates the country's bonds as "stable" rather "than negative, possibly indicating that Ireland will hold the Aa2 rating for a while.
Tuesday will mark a major test for the country, as Ireland will attempt an auction of as much as 1.5 billion euros in six-year and 10-year notes.
Greece, Ireland, Spain and Portugal have all seen downgrades in recent months, as increased nervousness about the countries' financial stability drive up borrowing costs. So far, however, only Greece is classified as "junk" grade.
In the long run, these assessments of weakness in the bond market will be good news for investors in physical gold and silver, assets which tend to do well in times of economic distress. Despite some recent weakness in the precious metals sector, investors are beginning to realize that in the long run, shaky debt and the dangers of inflation threaten to undermine their hard-won gains.
