Tuesday, June 05, 2012

And yet...

...Sovereign entertained no displeasure nor offered to disclose the actual health of their respective economies when they were highly rated.

This has now evolved from amusing to troubling.  I find the ratings agencies to be whoefully inadequate, but in all honesty cannot think of another more "objective" alternative.  I doubt one exists.

(Reuters) - Italian prosecutors have probed Standard & Poor's headquarters in New York for alleged market manipulation in a investigation over the credit-rating agency's downgrades of Italy, a legal source said on Tuesday.
The S&P base in New York was probed by prosecutors in Trani, a small town in southern Italy, under a law which holds companies liable for crimes committed by their employees.
A lawyer for S&P in Milan said he believed the development was a "formal step" in the ongoing Trani case. S&P has rejected the prosecutors' allegations as groundless.
The probe is part of a larger investigation into a raft of downgrades by S&P, Moody's and Fitch for debt-laden Italy that prompted a sell-off of Italian assets and fuelled long-running frustration with global rating agencies.

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