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Europe Launches Ban On All Policy Criticism By Scrapping Use Of Rating Agencies

Tyler Durden's picture




 

Why are we not surprised? The EU has just voted to scrap the use of ratings agencies in the next step on the road to a ban of all policy criticism. Via Bloomberg,

  • EU LAWMAKERS APPROVE AMENDMENT TO END USE OF CREDIT RATINGS

It seems just a few years ago, when these very same ratings agencies were raising ratings and supporting banking systems, mortgage provision, and sovereign-inclusions-into-monetary-unions, that the political elite could not showing off their bronzed statues of AAA/AA-ness.

And in the most bizarre of twists, they would prefer if they were allowed to rate themselves:

  • LAWMAKERS CALL FOR EU TO ISSUE SOVEREIGN CREDIT RATINGS

In other words:

I am Herman van Gollum, and I give Spain AAA+++. I would do business with this customer any time.

We only wish we could put this in haiku format.

 

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Tue, 06/19/2012 - 11:10 | 2539480 fuu
fuu's picture

The farce is strong with this one.

Tue, 06/19/2012 - 11:12 | 2539496 IBelieveInMagic
IBelieveInMagic's picture

In a way it may be a good thing for investors -- they are now forced to get off their fat asses and do their homework.

Tue, 06/19/2012 - 11:14 | 2539513 Ethics Gradient
Ethics Gradient's picture

Sure, but the ratings will still exist. It'll just mean that greek banks will be able to pledge greek debt to the ECB as collateral for leverage at face value.

This, surely then, is a plan with no draw backs!

I mean, what could possibly go wrong?

Tue, 06/19/2012 - 11:15 | 2539525 hedgeless_horseman
hedgeless_horseman's picture

 

 

Note to Sean Egan:  Do NOT have unprotected sex in Scandenavia.

Tue, 06/19/2012 - 11:17 | 2539532 Paul Atreides
Paul Atreides's picture

Perpetuating the ponzi...more groundhog day bullshit. Like anyone but the algo's gives a damn what these rating agencies think. Anyone still left in this market is only giving it approval, pull the fuck out all ready in protest and lets end this paper pyramid of shit.

Tue, 06/19/2012 - 11:19 | 2539542 idea_hamster
idea_hamster's picture

I don't understand what the big deal is.  When Argentina recently had an inflation problem, outlawing reports of inflation that contradicted the official figures solved everything.

Wait...wut?

Tue, 06/19/2012 - 11:22 | 2539565 MillionDollarBonus_
MillionDollarBonus_'s picture

It's about time that EU officials stood up to these rogue rating agencies. For months now, these agencies have been consistently downgrading the credit of perfectly solvent sovereigns and banks  It was only after the rating agencies and the hedge funds (the 1%) launched their assault on unfortunate countries like Spain and Protugual that this crisis escalated. Finally the people are waking up.

Tue, 06/19/2012 - 11:23 | 2539571 Pladizow
Pladizow's picture

"Money power denounces, as public enemies, all who question it's methods or throw light upon its crimes." - Jennings Bryan
 

Tue, 06/19/2012 - 11:28 | 2539581 hedgeless_horseman
hedgeless_horseman's picture

 

 

Europe is Argentina.

Argentine President Cristina Fernandez de Kirchner is facing accusations her administration is seeking to muzzle independent economists for publishing data that runs counter to the government's version of key statistics on economic performance.

 

...the government filed criminal charges against the managers of M&S Consultores economic consulting firm after several weeks of public arguments over the veracity of competing figures on inflation.

 

http://www.upi.com/Top_News/Special/2011/07/13/Argentina-accused-of-muzzling-economists/UPI-86431310586815/

Tue, 06/19/2012 - 12:38 | 2539851 Manthong
Manthong's picture

How about a new referral site  "Angela's List" dot com? 

for "Ratings You Can Trust"

 

 

Tue, 06/19/2012 - 15:35 | 2540532 THX 1178
THX 1178's picture

Triple A-ness and Double A-ness... Marvelous achievement or serious medical condition?

Sat, 06/23/2012 - 04:15 | 2553254 BooMushroom
BooMushroom's picture

Nobody did a haiku! You guys are slacking!!

Ostriches in power
Heads buried under fiat
Winter is coming

Tue, 06/19/2012 - 11:23 | 2539572 Paul Atreides
Paul Atreides's picture

"Finally the people are waking up." - There I fixed it for you.

Tue, 06/19/2012 - 11:26 | 2539588 Divided States ...
Divided States of America's picture

Short Moodys (MCO), no need for them anymore in this crooked financial system.

Tue, 06/19/2012 - 11:57 | 2539718 silverserfer
silverserfer's picture

"Fawnlawlrs them fellers waken out sleepin"  Theres I done fixed it fer ya.

Tue, 06/19/2012 - 12:11 | 2539778 The Big Ching-aso
The Big Ching-aso's picture

 

 

Someone here please lend me a million.  I'm good 4 it.  Honest.   Family references upon request.

Tue, 06/19/2012 - 11:26 | 2539585 financial apoca...
financial apocalyptic contagion's picture

read this seriously MDB, but trolling on blogs, especially ZH is a dead art

No1 gives a fuck at your attempts at humor, we are all too busy doing our respective jobs/watching cat videos/ listening to justin bieber whatever the fuck people do

its not worth the effort- Quit

Tue, 06/19/2012 - 11:41 | 2539612 knukles
knukles's picture

And some of us really work for a living, too.

 

But more to the point....
As mentioned above, the ratings agencies will still exist.
And the issuer (exception being Egan, three cheers!) gets paid by the raters.
Hate the rateings, raters and stop paying...
Dimwitted, unintended consequence, trial by fire, no more bribe money...
The EU just bought non-investment grade ratings, wholesale, big time Charley, go fuck yourselves...
Are you people fucking stupid?
Ya'll gotta play some of the fictitious game, folks.
Everybody already knows....
And in any case, nobody's gonna believe the 'New and Improved" EU ratings, rating the EU rate-ability by the Eu ratings agency, if any.

LOL

Jesus...
They'd already ignored the whole ratings business by letting the buyers carry all the shit (SHIT) at book...
Why inflame the situation and go to war?

Something about holes and digging..
Something about credibility..

Oh yeah, that Credibility Trap

 

Tue, 06/19/2012 - 12:21 | 2539801 The Big Ching-aso
The Big Ching-aso's picture

 

 

The foreseen consequence is that banned rating agencies will now have more influence than ever.  Brilliant.

Tue, 06/19/2012 - 14:14 | 2540235 knukles
knukles's picture

Exactamundo

Keep your friends close and your enemies closer.
(Kind of an old lesson once again forgotten.)

Tue, 06/19/2012 - 11:32 | 2539609 paddy0761
paddy0761's picture

Sorry MDB, just not credible sarcasm. You are trying too hard; just relax and let the Marxist euphoria wash over you before you post next time. You can do better - I've seen it.

Tue, 06/19/2012 - 13:06 | 2539958 Matt
Matt's picture

What do you mean? The truth only affects you if you are aware of the truth. If people stop alerting people to these insolvency problems, they won't become problems. This is all a confidence game, a ponzi scheme. If no one ever panics, the ponzi will not collapse.

If people didn't panic and pull their money out from Bernie Madoff's scheme due to losses outside of that scheme, it would not have collapsed and no one would lose their money.

This is the very reason that starting a bank run is illegal. Causing a panic is the problem, not the fact that there is a reason to panic. Even if panicing is the rational, reasonable thing to do, it is the act of panicing that causes a collapse.

Withdrawing money must soon be restricted, it is the only fair way to ensure that everyone has an equal opportunity to access their money.

Tue, 06/19/2012 - 12:18 | 2539803 No Euros please...
No Euros please we're British's picture

roflmfao, that's the best post yet, and Protgual that's a killer. You're better than Frankie Boyle!

Tue, 06/19/2012 - 12:35 | 2539854 battle axe
battle axe's picture

MDB: Where have you been?

Tue, 06/19/2012 - 16:42 | 2540800 Gief Gold Plox
Gief Gold Plox's picture

Good one, MDB. I really liked the "perfectly solvent sovereigns" part. Now say that 5 times really fast.

Tue, 06/19/2012 - 11:20 | 2539552 Element
Element's picture

Shit is shit ... why quibble?

Tue, 06/19/2012 - 11:26 | 2539586 strongband
strongband's picture

Element: hello again. Shit is shit. The point is, why should anyone listen to agencies now when they never got it right back in 08. Better to remove the problem first. Hopefully they can work out an impartial way of carrying out ratings.

Tue, 06/19/2012 - 11:46 | 2539662 Element
Element's picture

Just have the Pope bless them, then wave the flies away, like he does at mass ... doing god's work stuff ... and instant AAA ratings, for GS to go on about doin' God's work.

 

Tue, 06/19/2012 - 11:52 | 2539693 strongband
strongband's picture
  • ZH GOES FULL RETARD - DOESN'T READ THE ARTICLE, ONLY THE HEADLINE.
Tue, 06/19/2012 - 14:51 | 2539773 fuu
fuu's picture

http://www.bloomberg.com/news/2012-06-19/eu-lawmakers-approve-amendment-to-scrap-use-of-credit-ratings.html

"For sovereign debt, the parliament’s amendments would require ratings companies to pick two to three dates a year for issuing assessments, with publication outside these dates subject to approval by the European Securities and Markets Authority.

Such ESMA approval would only be forthcoming in cases of “exceptional and unforeseen circumstances,” according to the text of parliament’s amendments. "

"The lawmakers also sought to bolster the commission’s proposals by calling for a ban on mergers between large ratings companies, and for all references to credit ratings to be repealed from EU financial regulation. "

Wrong again strongband.

Tue, 06/19/2012 - 12:30 | 2539842 HoofHearted
HoofHearted's picture

strongband, the best ratings are MARKET-IMPLIED ratings. We figure this shit out long before Moody's or D&B or S&P or Fitch do. Now we have market-implied ratings (more or less) from someone who actually has to be right in order to keep in the market. What's that guy's name again? Oh, yeah, Sean Egan. And who is being investigated by the porn-wacthers SEC? That's right. Why?

Well, "Truth is treason in the empire of lies." All credit to RP on the quote.

Tue, 06/19/2012 - 13:14 | 2539988 strongband
strongband's picture

Agree.

Tue, 06/19/2012 - 13:29 | 2540060 Ghordius
Ghordius's picture

disagree. in the "old days", yes. yield did mean something, then, and ZIRP-"forever", manipulated CDSs and other derivative markets were unimaginable or just plain illegal.

but today? no. we are in a phase of economic and monetary war. markets? market-implied? those words have lost their previous meaning

the standard keynesian commentators from UK and the US are simply baffled that some core continental europeans refuse to go the easy way and cheat-in-the-proper-and-approved-way and are, on the other side, completely shocked that they prefer their own brands of cheating. or, my goodness, go without too much cheating and face the possibility of restructurations and/or defaults.

Tue, 06/19/2012 - 11:16 | 2539531 Blue Horshoe Lo...
Blue Horshoe Loves Annacott Steel's picture

What investor in their right mind wouldn't just resort to NOT buying any of them?

Tue, 06/19/2012 - 11:46 | 2539671 bdc63
bdc63's picture

for those of you that weren't paying attention, we just passed over the line of "absurd" and into "surreal".

Tue, 06/19/2012 - 12:25 | 2539824 dicktator
dicktator's picture

In soviet-style-comitee-led brusselaucratic dicktatorship the government rates YOU.

 

Stalin used to say "there's a man, there's a problem".

Tue, 06/19/2012 - 11:19 | 2539547 silver500
silver500's picture

This is censorship is part of the debt slavery process.  Eventually in order for the farce to keep going we need a 100% totalitarian regime, where:

 

·         It’s a criminal offence to comment on the solvency of nations

·         It’s a criminal offence not to purchase sovereign debt each month

·         It’s a criminal offence to keep money outside the banking system

·         There are no elections

Tue, 06/19/2012 - 11:38 | 2539627 pods
pods's picture

They will never get rid of elections.  

pods

Tue, 06/19/2012 - 15:59 | 2540644 Harvey Lee Oswald
Harvey Lee Oswald's picture

Agreed.

"If voting changed anything they'd make it illegal" -Emma goldman

Tue, 06/19/2012 - 11:24 | 2539574 Mesquite
Mesquite's picture

'Investors'...? What's that..?

Tue, 06/19/2012 - 11:39 | 2539631 CPL
CPL's picture

This is the point where gold and silver and oil get reall, really, really expensive btw.

 

No ratings + No value and that means flight from all paper..

Tue, 06/19/2012 - 12:26 | 2539830 scatterbrains
scatterbrains's picture

Or it might also say,  don't test our resolve to prevent you from trying to escape our little fiat ponzi party because if we have to we'll outlaw private ownership of gold too.  Dare us bitchezz!

 

Tue, 06/19/2012 - 13:24 | 2539973 CPL
CPL's picture

Of course they will, but TPTB will have to figure out how to find it without anything mechanical to assist them.

 

With Oil moving out of the commoditiy class into the a full fledged currency, Governments and Armies of the world better understand one thing.  Print all the money you want for soldiers, tax collectors, assessors, "idea" men but it doesn't matter one bit of difference if the currency you are printing is worthless in comparison to the NEW currency of oil.

 

Let them print and assume that the status quo remains, reality is illustrating the unkindness of change of energy and economies. Ask India and Pakistan how the green energy revolution is going.

 

I'll go contrary on that investment to protect my assets and be prepared to fund my own projects and intiatives as required.  In five years five star generals will trade a tank and a platoon for 10,000 barrels of oil.

Tue, 06/19/2012 - 13:05 | 2539957 TJ00
TJ00's picture

Too much work, just sell everything, quickly!

Tue, 06/19/2012 - 18:35 | 2541061 beaker
beaker's picture

oh sweet Jesus! We're deep in the Twilight Zone now.

Tue, 06/19/2012 - 11:16 | 2539529 bigwavedave
bigwavedave's picture

thats too good! lol

Tue, 06/19/2012 - 11:26 | 2539583 vast-dom
vast-dom's picture

perhaps there will never be anything less than a melt up in the markets, forever and ever since the paper rumor idiocy contagion is all that's left.

Tue, 06/19/2012 - 11:27 | 2539592 slaughterer
slaughterer's picture

Watch Obama do the same in a week or two, with the full blessing of all of Congress.   USA = AAAAAAA overnight

Tue, 06/19/2012 - 11:50 | 2539683 Alpo for Granny
Alpo for Granny's picture

Ratings agencies are to banks/countries as PM's are to ______________.

A) Spiderman Towels

B) Thingamajigs

C) Fiat Money

D) JC Penny Stock

E) None of the above-All your ratings are belong to us.

Tue, 06/19/2012 - 17:19 | 2540872 TheFourthStooge-ing
TheFourthStooge-ing's picture

Alpo for Granny said:

Ratings agencies are to banks/countries as PM's are to ______________.

A) Spiderman Towels

B) Thingamajigs

C) Fiat Money

D) JC Penny Stock

E) None of the above-All your ratings are belong to us.

Answer: F) Pimps

because pimps like to own PMs.

BTW, it's summertime, so give Granny some Gaines-Burgers® to throw on the grill.

Tue, 06/19/2012 - 12:33 | 2539846 battle axe
battle axe's picture

BWHAAAAAAA HAAAAAAAAAA HAAAAAAAAA HAAAAAAAAA. Good luck EU......

Tue, 06/19/2012 - 11:36 | 2539482 gojam
gojam's picture

Now they are all XXX Rated !!

Now with free souvenir pull-out cartoon - http://theneedleblog.wordpress.com/2012/06/19/eu-vote-not-to-use-credit-rating-agencies/

Tue, 06/19/2012 - 11:10 | 2539483 TheDarkKnight
TheDarkKnight's picture

Soon they will blow up the credit agencies like in the ending of fight club..

Tue, 06/19/2012 - 11:10 | 2539484 icanhasbailout
icanhasbailout's picture

pretty much seals the deal that credit ratings were a scam from the get-go to suck in money from the rubes

Tue, 06/19/2012 - 11:10 | 2539485 achmachat
achmachat's picture

yay! we are all AAA+++ now!

Tue, 06/19/2012 - 11:20 | 2539555 gmrpeabody
gmrpeabody's picture

There are no losers, and we can all feel good about ourselves and each other. Finally..., no more keeping score!

Tue, 06/19/2012 - 11:49 | 2539646 hedgeless_horseman
hedgeless_horseman's picture

 

 

Finally..., no more keeping score!

 

Fun Fair Positive Governance

Every debt slave is a winner!

 

Tue, 06/19/2012 - 11:58 | 2539726 JohnKozac
JohnKozac's picture

Everyone gets an A+....we don't want to hurt anyone's feelings.....

Tue, 06/19/2012 - 18:08 | 2541005 CaptainObvious
CaptainObvious's picture

Brought to you by the same folks behind "Everyone Gets a Trophy Day".

Tue, 06/19/2012 - 11:57 | 2539719 knukles
knukles's picture

Holy shit!
The perfect socialist ideal!
Everybody's equal, the Benevolent Altruistic State has taken care of everything.
No more worries

War is Peace
Whatervethefuck is A-OK, peasant,

Suck on it

The Compleate State
The New Versailles

Tue, 06/19/2012 - 11:10 | 2539486 homersimpson
homersimpson's picture

For a bunch of taxpayer-funded fatcats, they have some absolutely thin skin.

Tue, 06/19/2012 - 11:11 | 2539487 midgetrannyporn
midgetrannyporn's picture

Ratings agencies are a waste of money and a tool for the bankstas only. Useless as moist teats on a bull.

Tue, 06/19/2012 - 11:19 | 2539549 Bob
Bob's picture

And then there's that. 

Tue, 06/19/2012 - 11:22 | 2539567 gmrpeabody
gmrpeabody's picture

Moist teats on a bull....? I guess I'm not paying attention as closely as you are.

Tue, 06/19/2012 - 11:11 | 2539490 Element
Element's picture

Why not? ... it isn't going to make any difference now.

Tue, 06/19/2012 - 11:11 | 2539492 Itch
Itch's picture

FUCKIN AAA

Tue, 06/19/2012 - 11:11 | 2539493 holdbuysell
holdbuysell's picture

The unintended consequences of this should be interesting.

Tue, 06/19/2012 - 11:18 | 2539494 LawsofPhysics
LawsofPhysics's picture

And this is a problem because ratings agencies have always been so good about given everyone an honest assesment, right?  < Sarc off >

Fucking laughable.  Desperate paper-pushing fucks, getting more desperate.  Awesome.

Tue, 06/19/2012 - 11:12 | 2539500 rqb1
rqb1's picture

you could not make this up.

Tue, 06/19/2012 - 11:24 | 2539576 DogSlime
DogSlime's picture

...and if you did, no-one would give it any credibility because it would be considered just too fucking insane to be real - like so much in the last few years.

It's just one big joke these days.  History will recount these times and people will piss themselves laughing.

21st Century and look at where we are.

Tue, 06/19/2012 - 11:12 | 2539502 junkyardjack
junkyardjack's picture

When you can't win with the current rules, change them. Fuck it...

Tue, 06/19/2012 - 11:13 | 2539503 shovelhead
shovelhead's picture

I heard Mutti has issued a fatwah on WB7 too.

Tue, 06/19/2012 - 11:13 | 2539504 ArrestBobRubin
ArrestBobRubin's picture

And the SEC will "oversee" the US ratings agancies.

Madness on both sides of the pond.

This stuff is about dogma and toeing the Party Line, not economics.

Tue, 06/19/2012 - 11:49 | 2539685 Bay of Pigs
Bay of Pigs's picture

This is end game type shit...no doubt about it.

Tue, 06/19/2012 - 11:13 | 2539508 Seorse Gorog fr...
Seorse Gorog from that Quantum Entanglement Fund. alright_.-'s picture

The system is eating itself

Tue, 06/19/2012 - 11:16 | 2539528 Element
Element's picture

Has been since 1933

Tue, 06/19/2012 - 11:14 | 2539509 AL_SWEARENGEN
AL_SWEARENGEN's picture

Were any Germans among the 'lawmakers' that voted to get this passed?

Tue, 06/19/2012 - 11:15 | 2539517 Yellowhoard
Yellowhoard's picture

In other news, the EU has issued a proclamation requiring all European women to compliment their husbands on their enormous cocks and bed skills.

Tue, 06/19/2012 - 11:15 | 2539522 otto skorzeny
otto skorzeny's picture

Awesome. "No really-this shit isn't cut with baby laxitive"

Tue, 06/19/2012 - 11:17 | 2539533 CcalSD
CcalSD's picture

So I guess the only meaning for AA in Europe is for those in Alcholics Anonymous..

Tue, 06/19/2012 - 11:33 | 2539611 Global Hunter
Global Hunter's picture

one of the things that really bothers me is the grammar and spelling police who appear on reader posts but I did see some humour in your spelling of alcoholics

Tue, 06/19/2012 - 11:43 | 2539657 Unholy Dalliance
Unholy Dalliance's picture

Did you call, GH? I am at your beck and service, oh most honourable pen-slave.

Tue, 06/19/2012 - 12:00 | 2539738 Global Hunter
Global Hunter's picture

no I didn't call you now man up and stop being a slave

Tue, 06/19/2012 - 11:17 | 2539536 dwdollar
dwdollar's picture

Nice plan. Close your eyes and pretend the world isn't on fire! That'll work!!!

Tue, 06/19/2012 - 11:18 | 2539540 tmosley
tmosley's picture

It's like trying to stop the dominoes from falling by triggering an earthquake.

Tue, 06/19/2012 - 11:25 | 2539580 gmrpeabody
gmrpeabody's picture

BTW..., earthquakes will no longer be allowed.

Tue, 06/19/2012 - 11:18 | 2539544 nobusiness
nobusiness's picture

Perfect time to down grade all the EU countries to their real ratings "Junk"

Tue, 06/19/2012 - 11:19 | 2539546 Sleepless Knight
Sleepless Knight's picture

If you are not winning the game - change the rules.

Tue, 06/19/2012 - 11:20 | 2539550 wcvarones
wcvarones's picture

"bronzed statues of AAA/AA-ness"

 

Pronounced "anus."

Tue, 06/19/2012 - 11:20 | 2539556 Everybodys All ...
Everybodys All American's picture

I'm sure all fund managers are good with that ... lol. This always ends well doesn't it Bernanke?

Tue, 06/19/2012 - 11:21 | 2539560 the not so migh...
the not so mighty maximiza's picture

What a confidence builder..hahahahahahahaha

Tue, 06/19/2012 - 11:21 | 2539561 Spigot
Spigot's picture

Truly un-fucking-believable. Good Gawd! The agencies don't even reflect reality, or lag it terribly so that their "ratings changes" end up doing no one any good. What in hell are these turds expecting to come down the pike that they do not want these "agencies" to comment on so far behind the curve that they are meaningless?!?

Desperate days ahead!

Tue, 06/19/2012 - 11:29 | 2539566 falak pema
falak pema's picture

I am waiting for them to ban all market plays outside 9-10 am, install Tobin, curtail naked derivatives,  encourage naked women, in eurozone; then I can sleep like rip van winkle in a twinkle.

There was once a king who did not like his courtiers making jokes about him. He blinded them all and then had them whipped every day for not warning him about the coming dips; blaming them for being blind as bats. What a king can do a continent can do even better. We all know there is no parliament in Brussels, just sprouts! 

correction : and Van Rompuy!

Tue, 06/19/2012 - 11:58 | 2539722 GeneMarchbanks
GeneMarchbanks's picture

Ah, Tobin. Can't wait for that ZH reaction...

Tue, 06/19/2012 - 11:22 | 2539568 They_Live
They_Live's picture

The cases are real ... The people are real ... The rulings are BULLSHIT.

Tue, 06/19/2012 - 11:23 | 2539570 financial apoca...
financial apocalyptic contagion's picture

you say i'm a bad player, well fuck you I don't care abt your stupid rankings 

Europe is no.1!!!

This is a sad day. what 6-7yrs ago they would celebrate each rise in credit rating as a success for the Euro

Everything is a success for a Euro, these faggots are blind

Tue, 06/19/2012 - 11:24 | 2539573 centerline
centerline's picture

Tyler -

Forgive my ignorance in this regard... but aren't some bond investment portfolios, funds, etc. tied to minimum independant ratings?

 

 

Tue, 06/19/2012 - 11:46 | 2539664 EverythingFubar
EverythingFubar's picture

Some (all?) Pension/Hedge funds etc are not allowed to invest in anything with a junk rating status. Should make for some interesting rewrites of the rules of investment. Rating agencies had it coming though, they've been utterly useless other than causing panic in the MSM when they belatedly react to market knowledge that is months old, and in many cases already well priced-in by the market when they suddenly stand up and appear to have a clue..

Tue, 06/19/2012 - 12:34 | 2539850 centerline
centerline's picture

I suppose I should emphasize in my question that use of certain agencies as opposed to others.  That is, investments tied to specific agencies with minimum thresholds for rating, price, etc.

Seems to me all this move does is swat the bees nest.  I doubt these agencies will stop rating soveriegn debt.  Might even provoke further and quicker downgrades - especially in the reporting becomes more opaque.  The net effect on most private funds is either nuetral or negative here at best.

Do they really think thier bullshit smells better than the independant agencies bullshit?  LOL.

Reeks of desperation and speak volumes about bad things REALLY are behind the scenes.

 

 

 

Tue, 06/19/2012 - 11:24 | 2539575 the 300000000th...
the 300000000th percent's picture

I think I'll follow suit and not use them as well. When I am trying to rent or whatever, I'll just tell them that i don't participate with the rating agencies any more because I dont like the score that they gave me. LOL!!!!!!!!!!!!!

Tue, 06/19/2012 - 11:25 | 2539578 Kina
Kina's picture

It won't help them at all.

Rates will be higher.

Tue, 06/19/2012 - 11:55 | 2539699 hedgeless_horseman
hedgeless_horseman's picture

 

 

Ding! Ding! Ding!  We have a winner!

Knowledge of risk brings rates down, the fear of the unknown and such.

Tue, 06/19/2012 - 11:25 | 2539579 Dreadker
Dreadker's picture

hahahahahaha!

 

oh wait... with a story like that you made me think its comedy friday time!  Its only tuesday! fml...

Tue, 06/19/2012 - 11:27 | 2539590 sbenard
sbenard's picture

to quote Biderman:

"Am I going crazy, or is the world going crazy?"

Is this denial or delusion?

Tue, 06/19/2012 - 11:28 | 2539596 ajk24455
ajk24455's picture

Have we just passed all the way through the twilight zone?  Not sure what the other side is even called! Hilarious.

Tue, 06/19/2012 - 11:30 | 2539599 Global Hunter
Global Hunter's picture

Participants medals for all...hooray

Tue, 06/19/2012 - 11:30 | 2539601 Jack Sheet
Jack Sheet's picture

In effect, this seems no different from the FASEB mark-to-fantasy "rules" applying to banks in the US

Tue, 06/19/2012 - 11:31 | 2539603 Stuart
Stuart's picture

Seriously, what's the big deal here?   It's not as if credit agencies have proven themselves as bastions of integrity.   We all know how bought off they were during the entire MBS debacle.   They've lost their credibility and should be disbanded like Arthur Andersen was.    Europe is sick and tired of US centered credit agencies focusing the bond market at them rather than on the US which has a bigger gaping hole to plug.   US based credit agencies are now acting as tools for US centered interests.   This move is hardly a shock... it's long overdue. 

Tue, 06/19/2012 - 11:31 | 2539604 SDRII
SDRII's picture

India rolls back plan to open retail market: http://www.washingtonpost.com/world/asia_pacific/india-suspends-plan-to-...

India flouts US led Iran sanctions: http://timesofindia.indiatimes.com/india/India-rejects-US-embargo-to-imp...

INR peaks Feb 3

India, the world's biggest bullion buyer, increased the tax on gold imports for the second time this year after record purchases widened the current-account deficit: http://www.bloomberg.com/news/2012-03-16/india-raises-gold-import-tax-fo...

India picks France in fighter contract: http://www.bbc.co.uk/news/world-asia-india-16809532

S&P warns on India outlook: http://blogs.ft.com/beyond-brics/2012/04/25/sp-cuts-indias-outlook-to-ne...

India may get downgraded (Fitch): The Outlook revision reflects heightened risks that India’s medium- to long-term growth potential will gradually deteriorate if further structural reforms are not hastened, including measures to enhance the effectiveness of the government and create a more positive operational environment for business and private investments. The Negative Outlook also reflects India’s limited progress on fiscal consolidation and, in particular, on reducing the central government deficit despite improvement in the financial health of state governments.http://blogs.ft.com/beyond-brics/2012/06/18/fitch-downgrades-outlook-for...

India gets waiver for Iran oil: http://india.blogs.nytimes.com/2012/06/12/india-gets-waiver-for-oil-trad...

Today: India gold imports outlook cut:

Bombay bullion association sees imports at 20-25M tons vs. 55-60M tons previous. http://news.goldseek.com/GoldSeek/1340107200.php

 

 

 

Tue, 06/19/2012 - 11:33 | 2539610 slewie the pi-rat
slewie the pi-rat's picture

this is due to such ratings agencies' criticisms being funda-mentally anti-semitic...

israel is the NW0!  welcome to america, comrade europeon BiCheZ! 

(you decide whether ? this needs a /sarc/  tag or not, ok?)

Tue, 06/19/2012 - 11:55 | 2539705 fuu
fuu's picture

I can't even tell anymore.

Tue, 06/19/2012 - 20:03 | 2541284 slewie the pi-rat
slewie the pi-rat's picture

i could tell  L0L!!!

people don't like that stuff! but with 4 junks i hafta remind them that arabs are semites...  and monotheists, too!

you and i are not outlawing certain political speech;  you and i are not banning short-sales in these countries and markets;  you and i are not lying about avery single fuking we do;  you and i are not changing the rules every quarter and moving the goal posts every week;  you and i are not warmongering counterfeiters;  well at least you're not...

we are not leviathan;  and leviathan knows it, too

leviathan is a fuking troll, BiCheZ!

Tue, 06/19/2012 - 11:37 | 2539622 FLUSA.com
FLUSA.com's picture

If gold and silver don't have to be subjected to credit rating agencies...for crying out loud why would the EU

Tue, 06/19/2012 - 11:37 | 2539623 Floordawg
Floordawg's picture

So convenient to change the rules every time they don't work in your favor. Just like spoiled little brats.

Tue, 06/19/2012 - 11:38 | 2539625 AGORACOM
AGORACOM's picture

Has any serious investor on this planet even considered what ratings agencies have had to say since 2008?

Regards,

George ... The Greek .... From Canada

Tue, 06/19/2012 - 11:39 | 2539632 Biggieshort
Biggieshort's picture

YAY, all problems solved, long EUR.

Tue, 06/19/2012 - 11:40 | 2539634 bnbdnb
bnbdnb's picture

United Soviet States of Europe coming to a theater near you.

Tue, 06/19/2012 - 11:40 | 2539635 strongband
strongband's picture

Weird, bloomberg is talking only about the rotation plan

Tue, 06/19/2012 - 11:41 | 2539641 hangemhigh77
hangemhigh77's picture

Next will be all banks customers must transact in the buff.

Tue, 06/19/2012 - 11:42 | 2539649 AmenRa
AmenRa's picture

Wouldn't this lead to a massive dumping of sovereign debt? The debt ratings by the big three are mandatory for a company to buy certain debt (I do believe). If you thought yields were high now just wait.

Tue, 06/19/2012 - 11:43 | 2539658 hangemhigh77
hangemhigh77's picture

And no one can drink big sugary drinks in a bank.

Tue, 06/19/2012 - 11:48 | 2539678 theTribster
theTribster's picture

You have to love this, although you can't blame the. The ratings agencies have no integrity anyway so this isn't a big deal, the whole financial system is nothing but a scam anyway. Has anybody listened to the ratings agencies since 2008 anyway? I mean they had Lehmen at like AA+ the day before they went bankrupt.

We know the Europeans are going ot get desperate as soon as Italy hits the wall, which they are apparetnly really close to. Then the bullshit has to stop and they have to deal with the problems or let the Eurozone break apart. Since I don't beleive they will allow the Euro to break apart we should see this peak in the next week or two.

Basically, the sovereigns will have to give up their sovereignty to Brussels (Germany) before a solution will be realized. Once this happens we'll see Eurobonds and various other measure to resolve the problems. Whatever they do will fall apart with a few years and the people will demand the Euro breaks up because every country at that point will be subserviant to German whims and even more draconian controls.

Basically, they'll get through this short term but ultimately the solution will destroy the Eurozone after the people get a taste of the new Europe - German style. Today's rally is focused on Ben and the Fed even through the realy issues in Europe still exist and what he does (or doesn't do) won't have any impact on that. Where's our firewall? (the printer, that's right).

Tue, 06/19/2012 - 14:12 | 2540227 epwpixieq-1
epwpixieq-1's picture

Interesting, how the people will dislike "the new Europe - German style", as most of them are dreaming to have an efficient politico-economical system as existing in Germany. The corrupt politicians and government officials in the rest of Europe, certainly will not like it, that is for sure. But the people and the business will love it, ones they realize that the only way one can make money is by being better then the rest on the market, and by corruption or shady business deals. So, improve/be better or perish/be poor.

Tue, 06/19/2012 - 11:49 | 2539682 bigwavedave
bigwavedave's picture

And Moody's is up 1.6% (MCO) ... Figures

Tue, 06/19/2012 - 11:50 | 2539688 strongband
strongband's picture
  • ZEROHEDGE GOES FULL RETARD AND DOESN'T READ THE BLOOMBERG ARTICLE PROPERLY.
Tue, 06/19/2012 - 11:53 | 2539695 Frank N. Beans
Frank N. Beans's picture

does this self-rating thingie apply to home buyers? this would really jump start housing again and put us back on the road to prosperity

Tue, 06/19/2012 - 11:55 | 2539702 JohnKozac
JohnKozac's picture
Spanish short-term debt costs reach alarm levels(reuters)

 

http://www.reuters.com/article/2012/06/19/us-eurozone-crisis-idUSBRE85D0...

 

Uber-Bullish! Dow up 110 points on the news.

Tue, 06/19/2012 - 12:05 | 2539757 Element
Element's picture

Shit hot!  maybe we can keep this thing going after all ... lol

Tue, 06/19/2012 - 12:45 | 2539734 LostAtSea
LostAtSea's picture

"But actually, he thought as he re-adjusted the Ministry of Plenty's figures, it was not even forgery. It was merely the substitution of one piece of nonsense for another. Most of the material that you were dealing with had no connexion with anything in the real world, not even the kind of connexion that is contained in a direct lie. Statistics were just as much a fantasy in their original version as in their rectified version."

"All rulers in all ages have tried to impose a false view of the world upon their followers."

Tue, 06/19/2012 - 12:00 | 2539736 Joe A
Joe A's picture

Rating companies also thought that US MBS were top.

Tue, 06/19/2012 - 12:10 | 2539775 Mongo
Mongo's picture

Sorry Herman von Rumpoy, ratemypoo.com is already taken..

Tue, 06/19/2012 - 12:22 | 2539818 J U D G E M E N T
J U D G E M E N T's picture

C'mon people, get your thinking cap on.  The probable reason for self rating here is to make the bad paper legally purchaseable to

the pension funds.  They cant buy junk paper, but they can buy AAA paper.  They will route all the private pension incomes into the ponzi

to keep it afloat.  If there are losses then the people eat it rather than the foreign governments and institutions. God help us.

 

Tue, 06/19/2012 - 12:49 | 2539904 sockratte
sockratte's picture

great idea. let the funds buy junk...

Tue, 06/19/2012 - 13:17 | 2539999 BudFox2012
BudFox2012's picture

Don't forget some dirivatives with those bonds too...

Tue, 06/19/2012 - 13:16 | 2539994 BudFox2012
BudFox2012's picture

Yeah, this allows them to do all kinds of shenanegans.  It will work, until it doesn't.  Then god help us.

Tue, 06/19/2012 - 13:11 | 2539980 Nnthnt1
Nnthnt1's picture

Financial repression 2.1: ponzi acceleration

Tue, 06/19/2012 - 13:26 | 2540038 AbbeBrel
AbbeBrel's picture

Come on get serious.   The ratings have been a joke forever, even though there are exceptions of people who actually believed the ratings.

<< ZH Why are we not surprised? The EU has just voted to scrap the use of ratings agencies in the next step on the road to a ban of all policy criticism. >>

It appears that we are now dealing with some sort of diffusion along a scale of naivete.   Near as I can tell the next few years will provide numerous "learning experiences" about trusting public information - always question the source.   It goes from "Trust and Verify" to "Distrust and Monitor/Evade"

<< TBS:  Lewis asks how people as intelligent, successful, honest and well organised as the Germans got drawn into such a mess and he concludes: “Others do not behave as Germans do: others lie. The same instincts that allowed them to trust the Wall Street bond salesmen also allowed them to trust the French when they promised there would be no bailouts, and the Greeks when they swore that their budget was balanced." >>

Tue, 06/19/2012 - 13:41 | 2540111 packman
packman's picture

Major, major facepalm on this one.

Sorry, Dan, but you've lost what little ounce of respect you had from me.  This article is completely wrong.

This move does not "ban the ratings agencies" - on the contrary it does the opposite.  It gives them more power.    You misread the article.  (this one presumably - http://www.bloomberg.com/news/2012-06-19/eu-lawmakers-approve-amendment-...)  They didn't scrap the use of ratings agencies - they scrapped the rotation requirements for the use of agencies.

The previous proposal would have forced the banks to rotate between the agencies every 3 years, and this rotation would have applied to all debt.  Now the new thing is that the rotation is only ever 5 years, and it only applies to certain debt. 

The ratings agencies are still used for all the debt.  This change reverts back closer to the way it was (i.e. they get to pick an agency and stick with it).

 

Tue, 06/19/2012 - 14:46 | 2540357 Umh
Umh's picture

The phrase "for all references to credit ratings to be repealed from EU financial regulation." seems to ban the official use of the ratings agencies.

 

Tue, 06/19/2012 - 16:36 | 2540777 packman
packman's picture

That's down in a section of the article that seems to include any brainstormed idea put forth.  It doesn't seem to be a serious proposal (let alone an actual instituted ban), as evidenced by the first part of that very sentence:

The lawmakers also sought to bolster the commission’s proposals by calling for a ban on mergers between large ratings companies, and for all references to credit ratings to be repealed from EU financial regulation.

(why would you ban mergers between something that doesn't exist?)

and by the whole rest of the article, which points out the proposed changes in rules regarding how to use the ratings agencies.

Or another possibility is that it just means that they don't want to require the use of specific ratings in their financial regulation - e.g. they won't require that a bank hold X percentage of AAA-rated securities in given portfolio in order it to be considered part of a certain capital tier.  But "not requiring" and "banning" are two different things.

 

 

 

 

Tue, 06/19/2012 - 13:52 | 2540154 Bob Sacamano
Bob Sacamano's picture

Outlawing rating agencies from speaking is a bad idea.  Governments rating their own or each others' debt is a bad idea.

Stripping rating requirements out of government regulation is a great idea and should be pursued everywhere.  Rating agencies may not like that since it creates more revenue for them (although the the CEO of S&P supported such a couple of years ago when it was being considered in the US).   Also presume many institutional investors like hiding behind ratings for protection if their fiduciary responsibility comes under attack (i.e., don't want to admit they did not do much homework on their investments).

Tue, 06/19/2012 - 14:42 | 2540341 Umh
Umh's picture

It's now official the western world has converted to the Martingale System! They will just keep doubling down until they are a Euro ahead.

Tue, 06/19/2012 - 15:46 | 2540580 Miles Kendig
Miles Kendig's picture

Plain gain Spain's fain reframed

Tue, 06/19/2012 - 15:58 | 2540638 debtor of last ...
debtor of last resort's picture

This pigeon just downgraded the whole EU to junk status. As it should be.

Tue, 06/19/2012 - 17:28 | 2540906 CaptainObvious
CaptainObvious's picture

"And in the most bizarre of twists, they would prefer if they were allowed to rate themselves"

Oh yeah, that'll certainly work.  This is akin to allowing the naughty child to determine how many spankings he is going to get.  You just know the answer will always be "none!".

Tue, 06/19/2012 - 21:58 | 2541639 StychoKiller
StychoKiller's picture

Bad news (again!) you say?  Quick, line the messengers up against the wall:  Ready, fire, aim!

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