Moody's (NYSE:MCO): Ireland May Go "Credit Negative"

After the expected announcement Ireland would have to be bailed out, despite the anemic denials, Moody's (NYSE:MCO) said the increase in the amount of debt held by the country may result in a “credit negative” for them.

Even so, it is expected for the country to undergo a multi-notch downgrade, but still have their rating remain within the investment-grade category, although it's not a 100 percent certainty.

The two major uses of the capital by Ireland will be to use about $130 billion of it in order to keep them from selling bonds, and the second would be to supply lenders with capital via a "contingent" capital fund.

This will probably result in the fall of the Irish ruling coalition in Ireland, with the likelihood of elections held in January as as consequence.

Concerns this may generate in a domino effect in Europe is obvious, and uncertainty over the already bailed out Greece has re-emerged, as it appears they may still be dishonest about the size of the deficit the have.