货运到新西兰:US downgrade, Chinese rating agency is prescient

来源：百度文库 编辑：九乡新闻网 时间：2024/04/28 12:39:01

US downgrade, Chinese rating agency is prescient



US debt.jpg (18.78 KB)
2011-4-21 09:21


When S&P downgraded Japan in January, markets took fright. The move, it seemed, had come relatively out of the blue. Except in Beijing, where Dagong, China’s own official ratings agency already had Japan’s debt down as ‘AA-’.


Look back a few months further, and there’s another Dagong move that now looks eerily prescient: in November it downgraded the US from AA to A+.


Here’s what S&P said on Monday when it cut its outlook for US debt to ‘negative’:

•The economy of the U.S. is flexible and highly diversified, the country’s effective monetary policies have supported output growth while containing inflationary pressures, and a consistent global preference for the U.S. dollar over all other currencies gives the country unique external liquidity.

•We believe there is a material risk that U.S. policymakers might not reach an agreement on how to address medium- and long-term budgetary challenges by 2013; if an agreement is not reached and meaningful implementation does not begin by then, this would in our view render the U.S. fiscal profile meaningfully weaker than that of peer ‘AAA’ sovereigns.


And here’s what Dagong said back in November:

•The serious defects in the United States economic development and management model will lead to the long-term recession of its national economy, fundamentally lowering the national solvency.

•The new round of quantitative easing monetary policy adopted by the Federal Reserve has brought about an obvious trend of depreciation of the U.S. dollar, and the continuation and deepening of credit crisis in the U.S. Such a move entirely encroaches on the interests of the creditors, indicating the decline of the U.S. government’s intention of debt repayment.

•Analysis shows that the crisis confronting the U.S. cannot be ultimately resolved through currency depreciation. On the contrary, it is likely that an overall crisis might be triggered by the U.S. government’s policy to continuously depreciate the U.S. dollar against the will of creditors.


Dagong and S&P may disagree with the Fed’s medicine (perhaps because of the side effects for certain ‘US creditors’ – i.e. China), but they clearly share some dim views of the patient.


Dagong finished its assessment with a stark warning in its outlook for the US: 'Dagong believes that the occurrence and development process of the credit crisis in the U.S. resulted from the long-standing accumulation of the contradictions in its economic system… Under the circumstances that none of the economic factors influencing the U.S. economy has turned better explicitly it is possible that the U.S. will continue to expand the use of its loose monetary policy, damaging the interests the creditors. Therefore, given the current situation, the United States may face much unpredictable risks in solvency in the coming one to two years.'


Dagong ranks a handful of countries AAA, its top grade, including Switzerland and Australia. China and Germany are among those on the next rung down, AA+. Then come AA and AA- followed by A+. Last year, when Dagong published a list of 50 sovereign ratings, the lowest ranked country was Ecuador on CCC. Plenty of scope for downgrades for those on A+. (FT)
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