LETTER: Moody’s can’t be trusted
Why is the agency still giving SA positive outlooks when the other two ratings agencies downgraded us more than two and a half years ago?
Lucie Villa of Moody’s Investors Services has done it again. She said on Tuesday that SA is safe from a credit rating downgrade for the next 12 to 18 months, with a positive outlook.
So now the government can lie back and relax, when SA’s debt is more than R3-trillion and growing, and our debt to GDP ratio is topping 60% and heading higher.
Villa projected that our GDP growth for the year will be down to 0.7% from her last projection of 1%, though the SA Reserve Bank, the World Bank and the IMF have already reduced their growth outlooks.
But isn’t Moody’s the same ratings agency that gave a clean bill of health to, and kept a triple-A investment rating for, AIG, Lehman Brothers, Bear Stearns and others — until they all went belly up back in September 2008? This brought on a global economic crisis reminiscent of the Great Depression.
Given that Moody’s is a company, not a charity, why is it still giving SA glowing and positive outlooks when the other two ratings agencies downgraded us more than two and a half years ago?
Jean Michel Bouvier