A big yawn
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?