The Dangerous S&P's Evaluation

In the global society are two ‘uncontrollable’ powers, the three credit rating agencies and news companies.

As is well known, the UN is ‘always-polite grandfather.’ The EURO which expected to be progressed to the world government is tumbling due to the economic crisis of the south Europe. In the global world without compelling powers the two ‘guys’ shrewdly exploit and threat many countries other than their own ones such as the US, UK, France, Deutch, and the other western advanced countries. It is because that they are very afraid of the NGOs and their countries.

They were too magnanimous to their own countries because they are jittery about tough NGOs, interest groups and government inside. On the contrary, they were too severe to the Asian new players. As they take much criticism from many countries, they suddenly changed past ‘evil’ image to an ‘objective-masked’ face.

The S&P downgraded the U.S. credit rating for the first time from AAA status to AA-plus, with “negative outlook.” The U.S. raing is lower than the ones of France, Canada, Australia, Sweden, etc. Who believes? The S&P went too farther past the common sense. They showed that they have been a political institution. They thought that their existence is more important than public interest.

Credit assessing to an organization and companies might be possible, but it is absolutely impossible to assess the country.

Let’s look at 5 pillars in the S&P Sovereing Rating Framework:
Institutional effectiveness and political risks, Economic structures and growth prospects, external liquidity and international investment position, fiscal performance and flexibility as well as debt burden, monetary flexibility.

How abstract and ambiguous! The assessment could be arbitraray according to their intention, short insights, and biases. It can be said that they challenge the area of the God. Maybe they use mathematical tools, computer programs, analytic models, etc. As seen plausible, their methods are ‘rubbish.’ The economic phenomena are affected and formed by unimagiable many factors. So some financial analysts and political scientists lacking world experiences are not able to evaluate such great and complex situations.

Above all, the thing itself to evaluate 127 countries is dangerous. The evaluation and results are little helpful to evaluated countries, while enormously helpful to the rating agencies.

Today’s economic recession is rooted in deeper systematic and accumulated contradictions. These contradictions are beyond economic and poltical causes, rather lie in cultural, mental, social-related problems. The S&P downgrade will only lead to worsening the present agonies. The U.S economy needs spiritual, cultural, movemental therapies, not economic policies. (The end)