A big yawn

Finweek English Edition - - Privatebuy -

SO SOME OR OTHER rat­ing agency has down­graded three South African-based banks. The week be­fore, one of the agen­cies down-rated the en­tire coun­try. Should we worry? Un­for­tu­nately, per­haps in­cred­i­bly, the rat­ing agen­cies still carry a lot of weight. But over re­cent years I per­son­ally pay less and less at­ten­tion to them.

Look, they do have some top-notch an­a­lysts who are no doubt try­ing to do a cred­i­ble job. But I can’t help see­ing the rat­ing agen­cies as in­ter­na­tional firms that have some­how man­aged to de­sign a very comfortable, no doubt lu­cra­tive, mid­dle­man po­si­tion for them­selves. And from there they sit and pass judg­ment.

This is a blame game that will never end. But where were the agen­cies when we – when the world – re­ally needed them? They were giv­ing triple AAA rat­ings to the toxic sub-prime mort­gage pack­ages that have since brought the global bank­ing sys­tem to its knees.

So I find it hard to take them too se­ri­ously now. One of them will prob­a­bly go and down­grade me. Yawn. Do I care?

Newspapers in English

Newspapers from South Africa

© PressReader. All rights reserved.