This week may prove pivotal in the history of the ratings agencies, which have emerged from the crisis among the most hated companies in the world.Earlier, EU President Barroso slammed Moody’s for downgrading Portugal, while threatening to establish a new, EU-based ratings agency that wasn’t “biased”.
And now German Finance Minister Wolfgang Schaeuble is making similar comments, threatening to “break up” the oligopoly of the ratings companies. He too says he “can’t see basis” for the Portugal downgrade (even though Moody’s made its rationale pretty clear).
Combined with S&P’s threat to derail the Greek bailout, we may be seeing the actions that prove to be their ultimate undoing… at least in Europe. When they get serious about slashing the US AAA rating, that will hasten their US demise, as well.