Credibility of rating agencies

The financial industry there is a thing called rating agencies. From Standard & Poor's and Moody's, such rating professional company, also we are rating investment banks and securities firms such as Goldman Sachs and Morgan Stanley and bankrupt Lehman Brothers. They are about as the world stocks and bonds, and whether it makes sense to invest in the "rating", has been publicly quantified.

But the authenticity of this rating, there is a great deal problem. No clear definition as to the criteria of the rating, as the rating agencies to favor themselves, it is because you can manipulate intentionally rating.

A typical example of this problem is revealed, it is a sub-prime loan problem that occurred in 2007. Most of the rating agencies, had been given the highest rating of "triple-A" in the sub-prime bonds should be essentially junk bonds (non-investment grade). They rating agencies, since was selling the financial products that sub-prime debt has been incorporated also themselves, by giving a false reassurance to investors by making the them to high rating, I had inosine in sales promotion.

Also As for the individual stocks, they are by lowering of stocks that you want what we buy rating (the rating), giving the anxiety in the market is allowed to decline the stock price, themselves I done that charged at a low price. Of course, if they had a Share that you want to sell, it and picked up the stock price by raising the rating on the reverse, I Urinukeru at a high price.

Besides rating company, from general corporate at the request may also perform the rating of the company. Companies when performing financing by issuing stocks and bonds, if Moraere a high rating from the rating agencies, because financing can be in more favorable conditions. However, in this case, the rating agencies because is not to evaluate the partner companies that have got the money, etc. no reason that harsh assessment is made, tend to be sweet evaluation than the actual situation.

That is to say, they rating agencies, their convenient stocks and bonds, because that can be freely high a lot of evaluation of the company who at Mitsui the money to themselves, is highly questionable reason for its credibility. If the harsh words, the rating company is no different from "shite muscle" to manipulate the stock price by passing a variety of false information. Their aim is not to be disclosed the correct assessment to the world, because only I, such that what we earn.

You can be plausibly announced such as the daily reports of the securities company with such as "The ○○ stocks fell is because ×× Securities lowered the rating" but, by the change of such evaluation to swallow the do not. If you want to reference, at least by comparing the report and evaluation of more than one rating agency, whether it is "shite muscle" Acts of the? Or evaluation of the that to some extent it is credible? You should be comprehensive judgment.