Happy Friday y’all, now let’s talk some kak about the economy behind its back.

We know that for the last while we’ve been teetering on the brink of a downgrade to junk status, which as the name suggests may be worrisome for the country.

Next month could be crunch time, and whilst many fear the worst it may not be all bad news. Check out BusinessTech:

A cut to junk status would force the country’s borrowing costs upwards, and many expect an mass exodus of investment capital from the country as investors flee the market.

However, a number of economists believe that the country’s mature economy and developed infrastructure makes it a prime location for speculative investors…

Efficient Group chief economist Dawie Roodt previously said that a junk rating for South Africa would push investors away from South Africa, but also draw others.

He said that a developed economy like South Africa’s would ultimately hit a level of appeal where it would be impossible for investors to ignore. This view has now been echoed by a number of economists.

Yeah fine, but for the everyday South African those opportunities may be out of reach.

Just how close are we to junk status? Eish:

Ratings agencies, Fitch and Standard & Poor’s, currently have South Africa rated at one notch above junk status – with the former having a stable outlook, and the latter a negative outlook.

Both firms have been in communication with the South African government about the economic conditions in the country – which are bleak – and are expected to make assessments in the coming months.

Standard Bank chief economist Goolam Ballim has said that the country to pray for the best, but expect the worst outcome.

I think I’ll invest in a few beverages this evening and let the experts worry about all this.

[source:businesstech]

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