ECB takes aim at quick-draw rating agencies

Source: Reuters

BERLIN/VIENNA Fri Apr 30, 2010 6:36pm BST (Reuters) -

...

Bini Smaghi and Austrian central bank governor Ewald Nowotny said S&P had acted too hastily with its downgrade given negotiations on the aid and conditions were continuing among the ECB, European Commission and International Monetary Fund.

"I regard it as very problematic that S&P changed its ratings for Greece while negotiations about the measures were still going on," said Nowotny, who last month described agencies' sanctions as "bigger than God's."

...

"What is very strange, is that two days, or three days before knowing this programme .... people give a judgement on this programme without knowing it and say it will not work. And some of these are ratings agencies.

"It is very surprising that ratings agencies already communicate their intentions before knowing the data. This is (the) limit of ethical good practice and it will lead to a loss of credibility for these rating agencies."

Read more: http://uk.reuters.com/article/idUKTRE63T37020100430

S&P gave Greek bonds junk status. If Moodys and Fitch do the same, then Greek bonds will no longer be repo-able, which would be a "ruh-roh" moment. Of course, the ECB may make a special exception as they have the discretion to do that...but still it would be very troublesome.

perpetrated by these same ratings agencies....

They're as culpable as any of the originating banksters and fraudsters for the financial meltdown