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who's wagging? rating agencies have all rights to pen their assesments and be open to criticism. their marks however should reflect market conditions.

this was not the case - many developing nations now place their bonds at rates higher than developed yet their grades from S&P, Moody and Fitch are far far lower.

take Egypt which placed recently 1.5 bln doll bonds cheaper than Greece which still enjoy A rating.
Or Russia which sold 5.5 bln bonds at 3% (5 year) and 4.8% (10 years) which are lower than New Zealand or Australia's bonds yet "Big 3" still do not see reason why they should change BBB rating.

while grading sovereign debt by "Big 3" is suspect to political influence rating of corporate borrowers was the most glaring issue of corruption and conflict of interests.

that's why I urged (on all kind of forums) long ago to start investigation in activities of "Big 3" rating agencies. they should be severely punished if found guilty and possibly their licences should be suspended.

there will be new rating agencies in the market but they will be more cautious and transparent.

by FarEasterner on Mon Apr 26th, 2010 at 06:13:51 PM EST

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