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Rating agencies are just the banker's attempt to solve the inescapable principal-agent problem given conditions of imperfect information (read: incentive to lie, even to yourself) by trying to establish an institutional wall between lenders and risk analysts by outsourcing to a pooled resource. It makes a lot of sense and is an improvement over what existed before
The problem isn't, in and of itself, that the credit rating is outsourced.
The problem is that the credit rating - which, like all risk analysis is inherently (partly) political suddenly gets treated like an objective fact simply by the invocation of an Our Standards Are Poor "AAA" rating.
In that respect, it makes less sense than keeping it in-house: As long as it is done in-house, everybody who has eyes to see with will realise that the risk analysis is at least partly a matter of political fiat. By outsourcing it to a third party, it becomes easier to convince yourself that the resulting rating is an objective fact.
Even if we take as read that performing the political process of risk evaluation in a different organisational entity gives you objectively better data quality (something that is not altogether self-evident), it is perfectly possible that this superior data quality comes at a price of less competent and cautious data processing. And the quality of a decision is limited by the worst of the data and the protocols that deal with the data.
But I may be biased by the fact that I prefer to work with data whose pedigree I know...
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