The idiots at S&P are at it again, downgrading China's "debt." This asinine rating agency does not understand the distinction between a currency issuing nation (of which, China is one) and a country that doesn't issue currency or, that has debt denominated in another currency.
All of China's "debt" is denominated in yuan, which they have the monopoly power to issue. There is zero risk that China wouldn't be able to meet its obligations in yuan.
Anyway, what do you expect from a firm that rated all of the junk debt that caused the housing crisis AAA?
By the way, S&P is not alone. Moody's and Fitch are also just as bad. All three have their heads up their asses.
2 comments:
It's a ritual they go through to maintain the hegemony.
Just like comparing the 'public debt' to 'forecasts' and then saying that has created some room for manoeuvre. When actually the opposite is the case because lower public debt issuance means people out there are spending more on their own!
It's the ritual that matters. They are doing this and releasing it in serious tones. It must be important.
Means more US hedge fund managers and financial "geniuses" are going to lose their butts shortening China. Ha ha.
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