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Why an European Agency cannot be founded

Last week Roland Berger announced that he did not received the needed funds to found an European rating agency (see http://www.bloomberg.com/news/2012-04-15/roland-berger-is-short-on-ratings-agency-startup-cash-ftd-says.html). Did you wondered why? Why are the investors not interested in having a more independent rating agency? One new reliable rating agency that is not one of the “evil” big three from US?

Guess what – I think the real reason is that these “investors” are afraid of getting much worse ratings compared to S&P and Co. If this new European rating agency should work really independent and transparent, they probably would have to give worse credit ratings to most European countries than the big three. Maybe they would be not so low like the credit ratings according to the SWI, but certainly partly lower than the ones of S&P, Moody’s and Fitch (see List of countries by credit rating – comparison with SWI method, last update is unfortunately still Dec. 2011, but with the newest values there is not such a huge difference).

Conclusion: it is better (for the investors and governments) that there is no independent and transparent credit rating agency, otherwise the truth would harm them much more compared to the relative cosmetic corrections of S&P and Co.

Fortunately there is Wikirating – still small, but growing!

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