For French President Nicholas Sarkozy, the news keeps getting worse. His re-election already in trouble, France received a body blow when S&P downgraded their AAA credit rating along with 9 other EU countries.
This makes France's already troubled banking sector more of a problem, while it delivers a blow to the EU bailout mechanism, the European Financial Stability Facility (EFSF). Money from that fund will now be more expensive, putting in jeapordy the entire bailout plan for those nations on the brink of default.
Since France is responsible for 20.4pc of the EFSF, it is likely the "big bazooka" bail-out fund will itself lose its AAA credit rating too. Borrowing costs for the fund, and the countries it is tasked with supporting, could rise while the chances of it being leveraged from €440bn to €1 trillion are likely to be crushed.
The five PIIGS countries - Portugal, Italy, Ireland, Greece and Spain - together have €186bn of bonds and bills maturing in the first three months of 2012. The EFSF's remaining AAA countries could only guarantee around €290bn of debt of which €140bn is already earmarked for agreed bail-outs.
Just a day after Mario Draghi, the President of the European Central Bank, heralded "tentative" signs of economic stabilisation, S&P lowered the long-term ratings on Italy, Spain, Portugal and Cyprus by two notches, raising their debt-refinancing costs. Portugal and Cyprus were cut to junk status, while Austria also lost its AAA rating.
While the Netherlands, Finland and Luxembourg retained their AAA ratings, they were among 14 eurozone countries - also including France, Italy and Spain - that S&P put on "negative outlook", implying a one-in-three chance of a downgrade. Only Germany and Slovakia were "stable".
S&P said the downgrades were "primarily driven by our assessment that the policy initiatives that have been taken by European policy-makers in recent weeks may be insufficient to fully address ongoing systemic stresses in the eurozone".
In other words, kicking the can down the road just doesn't cut it anymore. Talks aimed at giving the EU unprecented powers to intervene in budget and tax decisions in individual member countries is going slowly and not making much progress. Without that authority, it is likely that several countries - including Greece, Italy, and Portugal - will default.