Why We Should Kill the Credit Rating Agencies

why not US buy back the FED for $450 million and print OUR money interest FREE makes more cents...to bad Congress don't have the ba!!s like Lincoln and Kennedy did...

same with the comsumer credit agencies, their data is so unreliable! garbage in , garbage out as they say. 3 agencies and they all have different data for me. do i want to spend the time telling these folks how/where they are wrong? not a chance.

Finally, finally, finally !!!! Someone speaks out about these greedy, unamerican agencies.

Dang, just when I figure out Kendrosky has nothing useful to say ever, he finally comes up with one thing that makes sense. I agree, get rid of credit rating agencies. If you need a quality measure for buying bonds, use the spreads to come up with an alternative. I Like it.

Lets kill these agencies. The reason being they failed to live up to the task and expectations for which they were created.We are wasting a lot of money from the institutions (ultimately the investor's money) to support and pay for these agencies. The agency instead of doing it's job gives a best rating for all the crooks and greedy fund managers and the investor loses more money in the bargain. Therefore my take is that these agencies are all bogus fronts created by the crooks for the crooks.

Credit ratings is bias...

The socalists are fools. FDR tried spending the country out of the depression. The depression was prolonged for twenty years. Remember, the stock market did not recover to pre-depression levels until 1954. The Republican Party took over in 1952.

Credit ratings good income, good wages and no debts an has a savings.........That is good ratings.... The old fashion way is plenty bank debts like credit cards debts and many debts, no jobs, low wages no savings that is not good ratings ......Which way do you assess a good credit ratings from the above...

unfair trade practice...the ability to display erroneous info that you (consumer) must correct. STINKS!!!

credit rating agencies are the lowest of the low. they live under a rock somewhere at the bottom of the deepest ocean. all they do is create a false face for banks so people get in trouble with credit cards then refinance your house so you get rid of credit cards then you use the credit cards and they raise you taxes and insurance on your home because they say you have great credit and encourage more credit. then the good part.you lose your house because of all the interest insurance and tax increases. signed a disabled vietnam veteran hopeless in a hopeless world.

Good idea .Why should billionaire Buffet be allowed to own 20% of Moodys?

Yes, sure. Republicans “fixed” in two years what democrats we not be able to fix for twenty. It’s nice to put a 1/8 of inch road coat and say –“I fixed the problem”, after somebody else dumped billions of cubic feet of gravel to stabilize ground. It’s really nice that all this scam crashed before Bush left the House. Never the less, there are plenty talkers blaming election of democrat for economy unable to recover. It will be plenty of them blaming democrats for the crash itself, as few years will pass. It’s nice to kill the agencies, but they were innovative and they do compete.

Perfect timing for this subject! In the early 1990s I had many questionable charges on my credit cards, so went through a bankruptcy attorney and judge= gone. 1993 I retired thinking no more financial problems. WRONG! In 1998 unpaid charges re-appeared mysteriously. Whole slew of "pay up" letters and annoying phone calls. My credit worsened and worsened by these 3 reporting agencies not doing their job and closing files after 7 - 10 years. Just yesterday 1/5/09 I got a very interesting phone call: a collection agent "Dan" wanted the $9K I owed from 1998. These reporting agencies have not done what they were supposed to do in the early 1990s, but what they DID do was totally ruin my credit-worthyness throughout 20+ years of my life- car loans, insurance, rentals, department stores all refused; on and on. Just plain misery for unsuspecting young people. All 3 reporting agencies should be gone- period.

It a RACKET! The reporting agencies and cards are in league to optimize the system to rake the consumer over the coals. Isn't this obvious? Why would there be a league of 'reforms' that OUTLAW current practices. The current racket has been deemed illegal.

Kedrosky is wrong (and by the way, he is talking about credit rating agencies that rate corporate creditworthiness, not personal credit worthiness). Credit rating agencies pre-date legislation limiting financial institutions from investing in speculative grade fixed-income investments. Credit rating agencies facilitate the subcontracting of monitoring of borrowers at the cost of some timeliness and accuracy, but also facilitate wider participation in fixed income markets. For the most part, credit rating agencies get single borrower fixed-income ratings right. What they should never have done was get involved in rating pools of mortgages written by many issuers covering many borrowers. The alignment of incentives makes such activity super dangerous and they got burned. The spread argument implies that fixed income markets are super efficient at reflecting information in prices (this may not always be true). But someone has to be generating information to be reflected into prices and that is what credit rating agencies do. Further, we know that spreads get distorted by the absence of liquidity even in the absence of negative credit information and so spreads can be decieving. Don't throw the baby out with the bath water, just because the baby pooped in the bath water.

My score is 794.EAT THAT. You are responisble for yourself. PERIOD.

Dr.Kedrosky does not seem to know much about the bond market. He argues that spreads will replace the agencies' credit ratings. But spreads, especially at the time of bond issuance, are driven importantly by the agencies' credit ratings. Secondary market trading for most issues is very limited. Moreover, the agencies rate different types of paper for thousands of corporate and government issuers and over 100,000 different structured products. Aside from the agencies, market makers and institutions research only a tiny fraction of that universe. Eliminating the agencies also eliminates their input and will lift the cost of capital for almost all issuers.

Man! For once, I completely agree!!! And after we do that, we go after insurance companies in exactly the same way. Outlaw them. I luv that quote - the world is worse off for their existence.

Too Bad Lincoln and Kennedy were both killed right before they were going to sign the bill that disbanded the FED. These were the last 2 presidents who tried to stop the FED.

Exactely. Everybody is trying to create a new bubble. Pretending to believe that all the bad news is figured into the market already. What a joke! Businessmen are committing suicide, banks are failing, over 11 million countable people unemployed, the big Three Auto makers failing and heading for bankruptcy, housing as a financial full back has collapsed. So you think this is all factored into the Market...Think again. The same people who created all the other bubbles are trying to recreate another market bubble. Sorry, but speculators suck!