When the troubles come home …

Once the challenges of Greece and Italy are resolved (or not) the vibrations of the financial troubles around the world will start to be felt first in the weakest links in the USA.  At the moment these are the states most at risk:

A list of the worst state risks, ranked by cumulative probability of
default (CPD). The default risk is measured through fluctuations in the state’s
CDS rating, and the height of that rating. The spread of each 10-year CDS is
listed, as well as the implied credit rating of each state on the list of
fiscal losers.

#11 – Pennsylvania

Cumulative Probability of
Default (CPD)
: 10.7%

CDS Mid 10 Year (in bps): 126.8

Implied Credit Rating: aa-

#10 – Florida

Cumulative Probability of
Default (CPD)
: 10.8%

CDS Mid 10 Year (in bps): 130.0

Implied Credit Rating: aa-

#9 – Ohio

Cumulative Probability of
Default (CPD)
: 11.2%

CDS Mid 10 Year (in bps): 134.0

Implied Credit Rating: a+

#8 – Massachusetts

Cumulative Probability of
Default (CPD)
: 11.2%

CDS Mid 10 Year (in bps): 134.5

Implied Credit Rating: a+

#7 – Rhode Island

Cumulative Probability of
Default (CPD)
: 12.4%

CDS Mid 10 Year (in bps): 148.5

Implied Credit Rating: bb+

#6 – New York

Cumulative Probability of
Default (CPD)
: 15.9%

CDS Mid 10 Year (in bps): 194.0

Implied Credit Rating: bb+

#5 – Nevada

Cumulative Probability of
Default (CPD)
: 16.7%

CDS Mid 10 Year (in bps): 205.0

Implied Credit Rating: bb+

#4 – New Jersey

Cumulative Probability of
Default (CPD)
: 17.1%

CDS Mid 10 Year (in bps): 210.0

Implied Credit Rating: bb+

#3 – Michigan

Cumulative Probability of
Default (CPD)
: 18.8%

CDS Mid 10 Year (in bps): 237.0

Implied Credit Rating: bb

#2 – California

Cumulative Probability of
Default (CPD)
: 20.9%

CDS Mid 10 Year (in bps): 260.0

Implied Credit Rating: bb-

#1 State Most Likely to Default – Illinois

Cumulative Probability of
Default (CPD)
: 21.0%

CDS Mid 10 Year (in bps): 260.0

Implied Credit Rating: bb-

Source: The Daily Bail

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