S&P to Maduro: down you go

Pray for a miracle, douchebag.
Pray for a miracle.

Standard & Poor’s downgraded Venezuela’s debt from junk to useless junk.

Why should you care? Because the lower our debt rating, the higher the interest rates we have to pay when we take out loans to pay for election binge spending. In other words, your grandchildren just got poorer, courtesy of S&P.

I think it’s significant that the ratings agency points to internal conflict within the chavista government as its greatest weakness – good to remember when Maduro tries to blame the chaos on us. It also says it expects high inflation and no growth this year, and that if the government were to implement the measures it needs to – read between the lines: eliminate the gasoline subsidy – it may not have the political capital to do it, in which case they would downgrade us even more.

Finally, the money quote, pointing to the deterioration of economic conditions in the country:

The cost to insure Venezuela’s debt stands at 1,047 basis points, up from 965 on Friday and far above the 645-point level at the start of this year, according to Markit. Venezuela’s benchmark 2023 dollar bond now trades around 85.5, yielding 11.49%. Don’t be surprised if that yield soon starts rising far higher.

But I guess this doesn’t matter because we have the FAO saying we’re doing great.

Caracas Chronicles is 100% reader-supported. Support independent Venezuelan journalism by making a donation.