Moody’s Attack on China ‘First Salvo of US Economic War Against Beijing’
SputnikNews.com
27.05.2017
Last week, in a move last seen in 1989 amid the events on Tiananmen Square, Moody’s downgraded China’s sovereign credit rating from Aa3 to A1. Russian economist Ivan Danilov warns that the move is highly significant. At best, he says, it was a financial sabotage operation; at worst, it was the first salvo of a US economic war against Beijing.
In his analysis piece, published by RIA Novosti, the economist explained that Moody’s explanation for downgrading China’s rating (i.e. that “China’s financial strength will erode somewhat over the coming years” due to rising economy-wide debt and slowed potential growth) is really a cover for motives which are at their core political in nature.
“The fact is that for a long time now, Western rating agencies have been performing a role that is political, rather than strictly commercial,” Danilov wrote. “Trying to find objectivity in their actions can only evoke a wry smile.” Unfortunately, however, these politicized decisions have real-world financial and economic consequences, the economist added.
“Lowering a country’s credit rating is not only a propaganda weapon, but also a very serious tool of economic leverage against one’s geopolitical opponents. The mechanism of this leverage works because the vast majority of private and public investment funds, as well as a significant portion of large corporations, is guided by such ratings when making the decision on whether to invest in a particular country.”
The Rest…HERE
