'Who cares what Fitch thinks? Why have the media been giving so much publicity to this rating agency?
On 20 January 2015, Fitch rating agency said it was “more likely than not to downgrade the rating of the sovereign” in the coming months. On 17 March, Fitch issued another statement saying there was more than a 50 per cent chance of downgrade by the end of June.
On 8 June, Minister in the Prime Minister’s Department confirmed that the government had held meetings with Fitch over its negative outlook. What transpired at the meeting with Fitch?
Finally, on 30 June, Fitch announced there was no downgrade and instead maintained its A- and A ratings and even improved its outlook from negative to ‘stable’.
Here’s why ordinary Malaysians should not pay too much heed to the Fitch rating as a measure of the state of the economy and our wellbeing.'
More:
http://anilnetto.com/corporate-led-globalisation/neo-liberal-economics/seven-reasons-why-we-should-ditch-fitch/
Nazri has just provided a clue: GST helped in Fitch's rating, which happens to be one of the seven reasons.
But the conclusion in the above article is convincing:
In conclusion, rating agencies have not had a glorious recent history and their role has been scrutinised in the aftermath of the global financial crisis. This was reported on the website of the Council on Foreign Relations:
‘CFR Senior Fellow Sebastian Mallaby argues that government regulation is unlikely to solve the conflicts inherent in credit rating agencies, particularly when it comes to sovereign debt. “The more government has power and is meddling with rating agencies, the more the rating agencies will be browbeaten into giving a generous rating to the sovereign,” Mallaby said.
‘The best way to counter the monopolistic power of the Big Three, he argued, is for investors to stop giving their ratings so much weight. “The reason why the subprime bubble could happen, or the reason why the European sovereign debt crisis can happen is, largely, that very blind investors bought bonds relying on ratings, and [didn’t do] their own homework about what the real credit risk was in the bonds,” said Mallaby.’
Stop pandering to these rating agencies. They do not represent the interests of ordinary Malaysians.
Link
On 20 January 2015, Fitch rating agency said it was “more likely than not to downgrade the rating of the sovereign” in the coming months. On 17 March, Fitch issued another statement saying there was more than a 50 per cent chance of downgrade by the end of June.
On 8 June, Minister in the Prime Minister’s Department confirmed that the government had held meetings with Fitch over its negative outlook. What transpired at the meeting with Fitch?
Finally, on 30 June, Fitch announced there was no downgrade and instead maintained its A- and A ratings and even improved its outlook from negative to ‘stable’.
Here’s why ordinary Malaysians should not pay too much heed to the Fitch rating as a measure of the state of the economy and our wellbeing.'
More:
http://anilnetto.com/corporate-led-globalisation/neo-liberal-economics/seven-reasons-why-we-should-ditch-fitch/
Nazri has just provided a clue: GST helped in Fitch's rating, which happens to be one of the seven reasons.
But the conclusion in the above article is convincing:
In conclusion, rating agencies have not had a glorious recent history and their role has been scrutinised in the aftermath of the global financial crisis. This was reported on the website of the Council on Foreign Relations:
‘CFR Senior Fellow Sebastian Mallaby argues that government regulation is unlikely to solve the conflicts inherent in credit rating agencies, particularly when it comes to sovereign debt. “The more government has power and is meddling with rating agencies, the more the rating agencies will be browbeaten into giving a generous rating to the sovereign,” Mallaby said.
‘The best way to counter the monopolistic power of the Big Three, he argued, is for investors to stop giving their ratings so much weight. “The reason why the subprime bubble could happen, or the reason why the European sovereign debt crisis can happen is, largely, that very blind investors bought bonds relying on ratings, and [didn’t do] their own homework about what the real credit risk was in the bonds,” said Mallaby.’
Stop pandering to these rating agencies. They do not represent the interests of ordinary Malaysians.
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