US Sovereign Debt Downgrade by China's Dagong Credit Rating Agency

Chinese credit firm says US worse risk than China

Dagong, founded in 1994 to rate Chinese corporate debt,
says it is privately owned and pledges to make its judgments impartially.

But in a sign of official support,
its announcement Sunday took place at the headquarters of the Xinhua News Agency,
the ruling Communist Party's main propaganda outlet.

Dagong's chairman, Guan Jianzhong,
said the current Western-led rating system is to blame for the global crisis
 and Europe's debt woes.

He said it "provides the wrong credit-rating information"
and fails to reflect changing conditions.

Associated Press, July 11, 2010

 

US Sovereign Debt Downgrade by China's Dagong Credit Rating Agency

The US sovereign debt gets a stiff downgrade, cut down from number one in the world, to a distant thirteenth place by China's Dagong Credit Rating Agency.

Governments like China do not take actions like this randomly, and their quasi-state organizations do not march to the beat of their own drummer. It will be interesting to watch this develop, and calculate the strategy, to figure out the next steps.

From a thematic perspective, coming up, competitive devaluations, and a shift in the reserve currency regime that will resemble a seismic shift, most likely pivoting around the SDR composition discussions later this year.

...China has slipped a shiv between the ribs of the almighty Dollar.

This is just the overture, the prelude to the dance.

And further down the road, trade wars...

And guess who the arms dealers are in this paper chase, selling to all sides?

 Who are the untouchables, the TBTF, a strategic asset in the financial arsenal of democracy?

The US media will downplay this, dismiss it, say it does not matter because China will not/ dare not/ can not/ do anything to change the status quo. And expect the spin to be laced with plenty of condescension. Oh those sly Chinese, just talking up their book, just like us. But who can take those little rapscallions seriously.

They are wrong, and they know it.

Well maybe not the news readers and the spokesmodels, who only know what they are told. But the strategists, the thought leaders, and the smart money most certainly know it. They just do not wish to share that information with you yet, because real knowledge is power...

Watch how people react to this, and how they spin it to you.

This will be an indication of either what they know, or the kind of character they have. Then you will know something about them and the kind of player they are.

...They think that you do not have a need to know anything about this yet, because you are intended to be cannon fodder...along with Europe, which is busy scourging its citizens into submission to more willingly serve the Anglo-American banking cartel.

And of course there is the new dictum, 'Extend and pretend. If it bleeds, bury it...'

Currency wars. Well at least a Phony War for now.

See, nothing has happened. All is well.

Move along.

Nothing to see here.

Status quo intact.

And so the fog of war rolls in.

Jesse