American Credit Rating Agencies Lose Influence (Financial Times Deutschland, Germany)
Dec 9th, 2011 | 5 responses
Are the once all-powerful credit-rating agencies, the most important of which are American – becoming irrelevant to the markets and those who invest in them? According to this editorial from Germany’s Financial Times Deutschland, despite the fact that Standard and Poor’s threatened to downgrade eurozone debt last week, European markets have hardly moved.
The editorial board of the Financial Times Deutschland starts out this way:
Tuesday’s experience with the powerful rating agencies permitted us to observe an interesting phenomenon. Standard and Poor’s was already threatening a possible downgrade of “AAA” countries in the eurozone (yes, Germany as well!) and of the European bailout fund along with it. And what happens? Nothing – or at least very little. The markets merely signal: We already know all that. And even Europe’s politicians, peeved as they are – are shrugging it off: yeah, yeah, the rating agencies – they’re just one voice among many. At most, S&P’s threat is an additional incentive for the upcoming Euro summit. Oh, right.
So what’s going on here with the rating agencies? Does bad news have less of an impact now that the big euro-apocalypse is predicted daily? Or is the oligopoly of rating giants discrediting itself because their operating methods are increasingly met with skepticism?
Both are the case.
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5 Responses to “American Credit Rating Agencies Lose Influence (Financial Times Deutschland, Germany)”
It’s ironic. These agencies exist solely to determine the reputation of other companies, and have lost their own.
Well, considering that their sole purpose was to protect investors from crappy investments, and throughout the impending fiscal crisis of ’08 they gave AAA ratings to what were basically junk bonds, I’m surprised these sacred guardians of the stock world still have any Wall Street cred. S&P should burn.
These credit rating agencies gave AAA rating to derivatives made up of bad loans because the investment banks paid them off, and thus they have a direct responsibility for the crash that started this whole mess. They should lose their influence, because we’ve seen what they do with it.
Erst keine mehr FPD in der Regierung. Deutschland braucht SPD/Grüne mit CDU alle wieder zusammen. In Frankreich kein mehr Sarkosy sondern Francois Hollande. Deutschland, Frankreich und Italien sollen die Euro halten. Das bedeutet die andere Ländern kommen auch mit die stärkte Gewerkschaft.
Was ist am wichtigsten macht nicht was die Amerikanern machen mit ihren Krankenkasse sondern Gegenteil. Europa soll besser sein wenn es gibt ein stärktes Staat für die Arbeiterklasse.
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