Friday, July 29, 2011

Who is Deven Sharma ?

If I told you that the most important person in the world now is Deven Sharma, you are most likely to be flabbergasted. Deven who ?? I am absolutely certain that not one reader of this blog has heard of him before. In fact I am sheepishly admitting that I had not heard of him either, one week ago. And yet for the next one week, he may actually be the most important man in the world.

Of course, this is hyperbole. But then what is journalism (ha ha) without some excessive exaggeration of reality. You can debate about the "most important man in the world" bit, but the actions of him and his organisation are certain to affect the world very profoundly in the week to come.

Deven Sharma is the President of Standard & Poor's one of the world's three premier credit rating agencies - Moody's and Fitch being the two other. In a short while, all the three agencies have to take a call on downgrading of America's Tripe A rating.

The drama in America on the debt ceiling goes on. This weekend, it has to come to a climax.  There is still a real possibility that the debt ceiling will not be raised, which means that come Tuesday, America will be in crisis, as will the rest of the world. This must be the outcome the three credit rating agencies must be secretly hoping for , as it makes their decision easy and non controversial - an immediate downgrading of America's debt. But the greater (barely) possibility still is that some highly sub optimal deal is struck and the ceiling raised. At which point the rating agencies have a problem on their hands. They need to decide.

The grapevine is that Moody's and Fitch are likely to preserve America's triple A rating. But S&P is tending more towards a downgrade. Deven Sharma and his team then have an important decision to make. If they downgrade, that symbolic act will probably be the last straw on the camel's back and financial mayhem is likely to follow.

The rest of the world has already downgraded America's debt in their minds. But everybody is waiting for that last straw before they can stampede. Something symbolic that will then trigger a chain of events that will be felt throughout the world. 
How has it come about that a hitherto unknown Indian American holds the key to what might happen to the world very shortly. OK may be "just a little" exaggeration, but I am afraid, not far from reality.