One of the remaining pillars who still has an AAA rating and should be rated much closer to junk is the UK. They are just another one of the major developed economies which has no possible way of ever paying off its government debt (without massively devalued British pounds - their currency).
This slow and steady deterioration of credit quality is exactly what happened with subprime during the 2006 - 2008 process. Everyone remembers the day Lehman Brothers failed, which was the climax of the subprime multi-year event, but they forget that there were small episodes for years that led up to that moment.
Mortgage backed securities laced with toxic subprime loans were rated AAA and valued at 100% all the way up to the end. Then they were downgraded, the veil was pierced, and the value of the debt went into free fall.
The same is occurring today with France (recently downgraded), the United States (recently downgraded), Japan (recently downgraded), and the UK (outlook just cut). The price being paid at this moment for the debt of these countries is the highest it has ever been in history (lowest bond yields) at a time when the credit quality of the debt is the lowest it has ever been in history (most likely to default). It is beyond a bubble, it is blind hysteria even worse than the episode in subprime, and it will not end well.
When will the "Lehman" moment occur? I have no idea. I'm selling all my developed world government paper and currency now. I would rather sit back and wait for the madness of crowds to run its natural course. I'll buy back in after the collapse, just as some investors, like Kyle Bass, are today with subprime mortgage debt.
See Kyle Bass: The Global Economy, Japan, & Why He's Buying Mortgages