I'll admit that I'm not terribly well versed in global economics, but it seems to me that this idea of ratings is a little bit stupid. I mean, an entity that can change global economics on a whim doesn't seem a good idea.
Yeah like what 9 countries got taken down a notch in the eurozone, Italy is now the lowest grade of investment an BBB rating, France went down as well. Although if Germany goes down it will be interesting. Although I'm no expert in Global economics, though im sure some of more intelligent residents have more information on this then I do.
Didn't some bunch of jerks try get Canada downgraded at some point in the 90's? Although the only source I remember for that is the book The Shock Doctrine, which isn't wholly reliable. Personally, and at the risk of sounding like a crazed Marxist, it just seems like a way of holding people/countries to ransom.
I think the idea of ratings are stupid. A set of 3 letters that can make the world economy go apeshit? I'm inclined to agree with AK as it does seem to hold nations to ransom. That isn't a crazy Marxist point of view because I think those views are more common than you think, BTW. These idiotic ratings agencies keep rocking the boat, when stability is important.
I know, it's just that it did sound like something SovietEmpireUSSR would have said. But then a clock that doesn't work is right every 12 hours, right? That sounds kinda harsh lol, but you all know what I mean, I hope.
We still good here too. still rated max in all 4 rating agencies.. you jelly Austria???? Also keep in mind that some form of rating agencies are required. This ratings are necessary to determine the risk for investors. Also without some form of ratings there would be nothing that keeps countries in check. It is probably not a good idea that the three most important agencies are US companies. I expect the EU to start a seperate rating agency during 2012/13. Because some of the downgrades are outright redicolous (like austria).
We let a few fatcats in corporations control our food, our healthcare (at least in America), our safety, and our oil. Why not our rating agencies? It's just another example of the failures inherent to the Capitalist System.
While there's certainly a lot of political BS that drives their decisions, S&P and organizations like it exist to provide information. If its information is consistently inaccurate or doesn't match up with other agencies then it's worthless. There is an active incentive for all credit ratings agencies, especially the Big Three, to provide accurate information. Trying to game the system would be so utterly complex and risky, not to mention counterproductive, that people don't try to do it. When political bias is manipulating the information, it's wholly transparent, as was the case with S&P's decision to downgrade the US's credit rating.
