I have absolutely ZERO confidence in any rating agency. They have so much power it's ridiculous and I'd be very very surprised if someone wouldn't be using that power to their advantage. I think the whole rating agency thing is ridiculous and could be abandoned.
LOL, you're exactly like me crimsong, zero as well because who are they after all? I am pretty sure that someone is profiting big time for each AA or B or whatever rating they give to countries. Yes, they are powerful enough to rate an entire country!!!
Why is there a need for these agencies anyway? I don't think there's any need for them, investors can just think for themselves, they don't need possibly biased agencies influencing the economies.
Most investors can think for themselves yes. Now go to an average Joe in the street and ask him about the economy in X country. It's easier to understand A+ and B+ rather than go through a 50 page file. Also all these ratings make for lovely headlines... "X country / company reduced to B-" and everyone panics.
Yeah, it's easier to understand that... those ratings are a huge scam based on financial engineering that no one understands. It's just another tool that the powerful of the world created to rip us off from what we have...
The problem is that panic that is generated whenever a country is downgraded, going from B+ to B- isn't a very significant change but it makes people panic because they start thinking that it will drop lower and lower, then that thinking gets incorporated into the collective mind and it all starts spiraling downwards until it actually does drop the rating lower... The rating is both the cause and the consequence.
I hear you. I agree 100%. It's all an illusion used to make people feel comfortable enough to invest money. It's a genius idea. The majority of people are followers so there will be an increase of investors purely based on people who appear trustworthy, filling you with false hope.
Yeah, that leverage concept they create is totally insane, it's pure speculation and the result is in sight. Funny as the exact same guys who created the crisis are the ones still in charge to lead us out of the crisis...
Well, if I wanted to get out of a minefield I'd want the guy that set it up guiding me It's a shame they don't really get punished though.
That's true, but I can't help being skeptical to see these sort of agencies having so much power, I just "wonder" if they are at our service or at the service of other hidden interests.
