The European Tribune is a forum for thoughtful dialogue of European and international issues. You are invited to post comments and your own articles.
Please REGISTER to post.
I suppose you could imagine, in the long term, the SEC rating the rating agencies on the accuracy of their forecasts and removing certification from ones who failed to do a good.
For example, how well has the SEC actually performed its less critical job responsibilities up to now? So why would we expect it to do much better job with greater power and responsibility over rating agencies?
In this case, perhaps the tree of credit needs to be periodically watered with the blood of rating agencies.
And make all financial transactions public with standard non-vague on-book accounting definitions, so that anyone with a mind to can check a rating for themselves.
That's not the point. The point is the market only exists within the rules set up by government. The brainless should not be in banking -- Willem Buiter
And people will believe the ones paid by the billionaires with real skin in the game before the government bureaucrats, like they do now in every filed regulated by government ratings and analysis.
"People" and "wealthy investors" can believe whatever they want. The point here is to prevent the banks from counterfeiting, not to prevent market-worshippers from being separated from their money.
- Jake Friends come and go. Enemies accumulate.
N months after a rating has been issued (where N possibly depends on the type of rating), the rating is compared to the actual reality. This information is then input into the Beatrice database.
The people who run the Beatrice database can then mine the now blinded data for noteworthy patterns. Any suspicious patterns discovered can be analysed independently, and only if they are actually damning is the Alice database contacted for retrieval of the identity of the suspicious author(s) and/or institution(s).
That's roughly analogous to how you'd blind a medical trial. It's not idiot-proof (no system is, and even if it were, the universe is continually working on inventing more creative idiots), and it's certainly not fraud-proof either (no institution in this universe can be made completely fraud-proof), but it would be head and shoulders above what we currently have.
(Assuming you even need rating agencies at all...)
by Frank Schnittger - Jan 26 3 comments
by Frank Schnittger - Jan 31
by Frank Schnittger - Jan 22 3 comments
by Cat - Jan 25 55 comments
by Oui - Jan 9 21 comments
by Frank Schnittger - Jan 13 28 comments
by gmoke - Jan 20
by Oui - Jan 15 91 comments
by Oui - Feb 13 comments
by gmoke - Jan 29
by Oui - Jan 2731 comments
by Frank Schnittger - Jan 263 comments
by Cat - Jan 2555 comments
by Frank Schnittger - Jan 223 comments
by Oui - Jan 2110 comments
by Oui - Jan 21
by Oui - Jan 20
by Oui - Jan 1841 comments
by Oui - Jan 1591 comments
by Oui - Jan 144 comments
by Frank Schnittger - Jan 1328 comments
by Oui - Jan 1221 comments
by Oui - Jan 1120 comments
by Oui - Jan 1034 comments
by Oui - Jan 921 comments
by NBBooks - Jan 810 comments