Ratings on sovereign debt seem kind of irrelevant to me. I don't see why the agencies would have any sort of edge. But I agree one of the most dumfounding fact

Ratings on sovereign debt seem kind of irrelevant to me. I don't see why the agencies would have any sort of edge. But I agree one of the most dumfounding facts of the present situation are that these rating agencies are still in business. I think the argument is that they were transparent about what methodologies they used to produce these ratings. But regardless of that, the blatant conflict of interest means this whole business model should be dead. I think Jim Simons of Renaissance Technologies made the point that it's the buyers who should pay for stuff to be rated, not the issuers. Possibly it may have worked like that in the past until the government stepped in and changed it... can't quite remember.