February 14, 201214 yr So now one of the credit rating agencies has put the UK on notice of a possible downgrade from its AAA rating. How is it, I wonder, that these rating agencies are still trusted and have any shred of credibility left? Did not their sheer inefficiency not contribute in a massive way to the chaos of 2008 and beyond? What has changed?
February 14, 201214 yr How is it, I wonder, that these rating agencies are still trusted and have any shred of credibility left? Did not their sheer inefficiency not contribute in a massive way to the chaos of 2008 and beyond? What has changed? I remember one excellent, but sadly defunct financial website succinctly describing the rating agencies as a "lagging indicator" that responds to what the markets have already decided. That summarises their failings very nicely. Their downgrading of various western (& Japanese) governments is merely a belated response to the irresponsible borrowing that has been going on for a couple of decades.
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