Tuesday, June 19, 2012

EU seeks to end criticism by banning ratings agencies

In the movie The Sum of All Fears, the antagonist made a statement about how Europe is treated like a step child between the super powers of the United States and Russia.



Today however, that step child is more petulant than ever, and will be defined by both their inability to resolve their financial problems, and in their inability to handle criticism.  In a move to stem criticism for their failed economic policies, the EU is putting forth a vote to ban ratings agencies from determining the solvency of their banks and financial instruments.

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 - Bloomberg via Zerohedge

Such is the ways of children.  When they don't want to play by the rules anymore, it is just a matter of taking their ball and going home.

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