1900, when John Moody founded Moody's Investors Service Company under his own surname, he just wanted to make a living on Wall Street by providing rating services for railway securities (these services are often complicated and changeable, which give investors a headache). Like other rating agencies, Moody's implemented free rating in the early stage of development, but Moody's work was really excellent, especially when the 1929 market plummeted, and none of Moody's high-rated stocks experienced a sharp drop in price, which earned enough attention in the investment market. Investors believe that Moody's analysis and rating are objective standards, and Moody's gradually began to collect money from investors.
Since 1970s, Moody's and its competitors, including Standard & Poor's (whose market share is larger than Moody's) and Fitch International (founded in 19 13), began to adjust their business methods. They not only charge investors, but also ask rating companies for money, thus laying a hidden danger of moral hazard. 1975, the United States Securities and Exchange Commission (SEC) recognized these three rating companies as the first batch of national certified rating agencies (NRSRO), and since then they have been labeled as semi-official. What's more, NRSRO subsequently developed into a monopoly organization, and no other rating company can really enter this organization.
Investors in the financial market pay homage to the three major rating agencies, and almost no one will care about bonds that have not been certified by them. Many financial companies waved dollars at them, hoping that their bonds would get a "3A" label. In this context, the income structure of rating agencies has also changed. Charging rating fees from financing companies has become the main source of profits, and it doesn't matter if they accidentally misjudge. No company dares to claim compensation from them. In the rating industry, at least 30% profit is common. In 2006, S&P's after-tax income was as high as $654.38+0.2 billion, while Moody's income was $654.38+0.3 billion.
"We sold our souls to the devil."
When an adjustment of "+"and "-"can stir up a thousand waves with one stone, rating agencies are pushed to the altar, and the greedy tradition of Wall Street has also invaded this field. Once upon a time, the "3A" rating, regarded as the gold label of safe investment, became a profit tool in the hands of rating companies. At the hearing held by the US Congress to investigate the 2008 financial tsunami, Moody, an administrator, said: "We sold our souls to the devil in exchange for money."
There is a well-known case in the industry: Hanover is a German reinsurance giant and was not originally a customer of Moody's. Moody wrote to Hanover, expressing his willingness to provide free rating service at the initial stage and establish a fee-based service relationship in the future. At that time, Hanover was already a customer of two other rating companies, so it rejected Moody's. Moody's began to rate Hanover. In 2003, when other rating companies thought Hanover's financial situation was good, Moody's downgraded Hanover's bonds to junk status, leading to selling. Hanover lost nearly $200 million in a few hours and finally had to surrender to Moody's.
From 2002 to 2007, the three major rating agencies rated thousands of innovative bonds produced by Wall Street as "3A", including a large number of subprime bonds. On the eve of the financial crisis, Moody's and Standard & Poor's also gave high ratings to 1 1 financial institutions, including Lehman Brothers, the trigger of the crisis.
Absolute monarch with sovereign rating
"We live in a world of two superpowers, one is the United States, and the other is Standard & Poor's and Moody's. The United States can destroy a country with bombs, and Standard & Poor's and Moody's can downgrade a country with bonds; Sometimes, the power of the two cannot be said to be greater. " The New York Times columnist Friedman commented.
Under the escort of the American state machine, the three major rating agencies can not only harm ordinary companies, but also harm the credit of sovereign countries. Although they did consider the objective factors such as GDP growth trend and foreign exchange reserves, in fact, the three major rating agencies are all behind the expansion of American financial capital. For example, until 2003, Moody's and Standard & Poor's only gave China a very low "3B" sovereign credit rating.
On June 8th, 2009, 65438+February 8th, 2009, Fitch took the lead in downgrading the debt-ridden Greek sovereign credit rating from A- to 3B+, and at the same time determined the financial prospect of Greece as "negative". Standard & Poor's and Moody's also downgraded Greece's sovereign credit rating. The Greek debt crisis broke out. Since then, every statement made by the three major rating agencies on the financial situation of Greece and other euro-zone countries has affected the sensitive nerves of the market. In April this year, Greece, Portugal and Spain were successively downgraded, and Greece's sovereign credit rating was even rated as junk by Standard & Poor's, thus the Greek debt crisis rose to the European debt crisis.
The practices of the three major rating agencies have aroused widespread doubts and accusations. Paris Huo Weici, head of AXA's investment strategy, even suspected that the timing of downgrading Greece, Portugal and Spain was carefully planned. "When Greece's aid negotiations with the European Union and the International Monetary Fund (IMF) have made progress, I don't understand why it is urgent to announce the downgrade of these countries." . He believes that the intention of rating agencies to balance the euro on behalf of US national interests is clear.
Standard & Poor's downgrade of US debt: a stone stirs up a thousand waves
In today's increasingly complex financial transactions, rating agencies have great financial discourse power. How to regulate and supervise the behavior of rating agencies and how to rebuild a transparent and efficient rating industry is worth pondering by all countries. China should also learn from the experience of international reform, speed up the upgrading, integration and reorganization of existing credit rating agencies, establish a supervision system combining government management and industry self-discipline, and strive for the right to speak in international finance to the maximum extent under the background of financial deepening and global economic integration.
The global market is experiencing a game of competition with credit rating. On August 5th, Standard & Poor's, one of the three major rating agencies in the world, downgraded the long-term AAA sovereign credit rating of the United States by one level to AA+, and the rating outlook was "negative", which immediately caused an uproar. Although Obama said that "the United States has always been and will always be a 3A country", the international stock market plummeted, and domestic A shares once fell by 2,500 points. Standard & Poor's rating may hurt the nerves of global markets.
In fact, almost all the most important national credit ratings and corporate ratings in the world come from these three institutions. Standard & Poor's currently has sovereign credit ratings of 65,438+026 countries and regions.
On June 27th, 65438, Standard & Poor's downgraded Japan's long-term sovereign credit rating from "A A" to "AA-", and the long-term sovereign credit outlook remained "stable". On the day of rating, the yen fell more than 1% against the US dollar to 1 US dollar against 83.22 yen. On July 28th, Standard & Poor's and Moody's downgraded Greece's sovereign credit rating respectively.
As early as 2009, Standard & Poor's criticized Greece and adjusted its outlook level to negative. At the end of April, Standard & Poor's downgraded Portugal's long-term sovereign credit rating. Subsequently, Moody's also put the sovereign credit rating of grape Aa2 on the negative watch list, followed by Fitch, which downgraded Spain's sovereign rating. As a result, the Greek debt crisis spread to Europe, which eventually triggered a sharp drop in the US and global stock markets.
Standard & Poor's single-handedly shook the United States, which currently dominates the financial system. Both Moody's and Fitch said that they will take a wait-and-see attitude in the short term. Moody's only warned that if the financial or economic prospects of the United States are greatly weakened, it will downgrade the sovereign credit rating of the United States before 20 13.