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  • La Conchita: ….and “the people” of Cuba, Geeee, I wonder what “people” they’re talking about?

  • Rayarena: Take a few days off DGI eavesdroppers! (Ernesto Londoño’s already securely in the bag!)–ROTFLMAO!

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realclearworld

Moody’s cuts Cuba’s credit rating

The news here shouldn't be that Moody's has cut Cuba's credit rating. The real news here should be that Moody's is apparently also in the business of rating military juntas whose main business enterprises include drug trafficking, arms smuggling, extortion, kidnapping, and other major crimes.

Via AFP in Global Post:

http://4.bp.blogspot.com/-srHsDjMz04I/UFty2RFMRGI/AAAAAAAAGAk/dsryXQmySzw/s1600/Logo+Moody%27s+Investors+Service.jpg
Moody's cuts Cuba rating on risk from Venezuela turmoil

Moody's cut Cuba's credit rating Wednesday by one notch, citing its vulnerability to a shock rise in fuel costs arising from turmoil in supplier Venezuela.

Moody's also cited the risk of a rocky political transition in the Caribbean island in the wake of the Castro regime as it cut the rating to Caa2 from Caa1, well into "speculative" territory for debt.

"Cuba relies heavily upon Venezuela for oil, which is imported with favorable financing terms through Petrocaribe," the credit rating firm said.

"Given Venezuela's increasingly unsustainable macroeconomic imbalances and elevated risk of an economic and financial collapse, the future of this arrangement is uncertain, rendering Cuba vulnerable to a sharp adjustment in the cost of energy imports."

It noted that energy imports cost the country $6.5 billion in 2012, nearly half of its total import bill.

Moody's also warned of "an abrupt and disorderly political transition", with revolutionary strongman Fidel Castro now 88 and his brother Raul Castro, Cuba's president, 83.

"While President Castro recently indicated that his current term will be his last and, at the same time, appointed a first vice president of the Council of State of Cuba, there is considerable uncertainty around the future state of Cuba's political economy."

While Cuba is deeply restricted in its ability to tap international capital markets, Moody's noted that Havana might be weighing reopening negotiations with the "Paris Club" of bondholders to resolve claims on long-defaulted debt.

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