Business Day Good.jpg 'Rating agencies are childish and slow growth is the Reserve Bank's fault' Genevieve Quintal, Business Day, Johannesburg, 26 September 2016 Duma Gqubule, founder of the Centre for Economic Development and Transformation, has questioned the credibility of rating agencies and whether SA should be listening to what they say. Rating agency Moody's was in SA last week. "I looked at the credit note on SA . I was shocked. It's a five-page document . it is such childish and infantile analysis and I don't think we should be listening to them," Gqubule told the Black Business Council's annual conference in Sandton, Johannesburg, on Monday. "Since when have these ratings agencies become credible?" Moody's new lead analyst for SA, Zuzana Brixiova, said last week that political divisions were the country's biggest credit weakness. READ THIS: Divisions in politics are SA's major weakness, says Moody's Moody's is keeping a close eye on political divisions ahead of a planned update to its rating on November 25. In May, Moody's confirmed SA's rating, but put it on negative outlook, implying a probability of a downgrade of about one-third. Moody's has put five state-owned entities on review for a downgrade on concern about their finances and ability to raise funding. Gqubule said SA's problem was not debt but gross domestic product (GDP). "People belive that SA is broke but SA is not broke." He said that in 2009, during the global financial crisis, SA's GDP fell 1.5% when all other developing countries' GDP increased 2.4%. Gqubule blamed this on the Reserve Bank and said it should be "implicated" in causing the last three recessions. He said the Bank had increased interest rates by 250 basis points before the global financial crisis, and then by another 250 basis points after the crisis. "Our downturn in the economy preceded the global financial crisis," Gqubule said. "The problem we have in SA right now is that we've had low growth of 1.6% for eight years . we can't still be talking about the global financial crisis." The Reserve Bank needed to cut interest rates. The country needed to work on changing the mandate of the Bank and change economic policies, he said. From: http://www.bdlive.co.za/economy/2016/09/26/rating-agencies-are-childish-and- slow-growth-is-the-reserve-banks-fault __________ Information from ESET NOD32 Antivirus, version of virus signature database 14191 (20160928) __________ The message was checked by ESET NOD32 Antivirus. http://www.eset.com -- -- You are subscribed. This footer can help you. Please POST your comments to [email protected] or reply to this message. You can visit the group WEB SITE at http://groups.google.com/group/yclsa-eom-forum for different delivery options, pages, files and membership. To UNSUBSCRIBE, please email [email protected] . You don't have to put anything in the "Subject:" field. You don't have to put anything in the message part. All you have to do is to send an e-mail to this address (repeat): [email protected] . --- You received this message because you are subscribed to the Google Groups "YCLSA Discussion Forum" group. To unsubscribe from this group and stop receiving emails from it, send an email to [email protected]. To post to this group, send an email to [email protected]. Visit this group at https://groups.google.com/group/yclsa-eom-forum. To view this discussion on the web, visit https://groups.google.com/d/msgid/yclsa-eom-forum/002401d2197f%24071f04a0%24155d0de0%24%40com. For more options, visit https://groups.google.com/d/optout.
