U.S. Government Ties to Big 3 (2) Credit Rating Agencies (NRSROs)





I am trying to understand in what ways the U.S. gov't interacts with credit rating agencies for its sovereign rating and any other rating it may have?  I am unsure how involved the gov't is with the CRAs besides what we know of the built in credit rating requirements for certain rules, regulations, statutory requirements, and other ties such as the PPIP and TALF.  Barney Frank said a few weeks back when the Obama Administration was sending Congress its recommendations on CRA reform that all of the ties with credit ratings and the gov't would be repealed.  I am skeptical it will happen given the gov'ts use of credit rating tie-ins after the financial crisis and obvious failures of the CRAs.  I'm trying to find out how much the gov't is in bed with the CRAs.  I wonder if the gov't has/does structure deals with the CRAs?  What type of assets are gov't investment funds invested in (Social Security, Medicare, PBGC, others?)?  Was the gov't peddled toxic assets with inflated structured ratings?  It would be interesting to shed more light on this.


 
 


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