Booming business for ratings agencies

Since 2006, Moody's, Standard & Poor's and Fitch have tripled their profits in Spain, reportsEl Périódico, which leads with the front-page headline: "Risk agency business thriving." The Barcelona daily continues: “In what appeared to be a situation that could not get any worse, with the eurozone on the verge of breaking up, one of the three agencies has dealt a fatal blow." On 13 July, Fitch slapped yet another downgrade on Greek debt, but as the newspaper points out "it could have been Moody's or Standard & Poor's,” both of which also play a critical role in "what has already been described as an 'oligopoly' by the European Union."

The business is "as simple as it is astounding," remarks the daily. "Their enormous weight on financial markets and the absence of regulation in North America" has made these agencies "a major problem, especially for sovereign states." In response to their “cheerful” downgrading of public debt, governments "have been forced to use public money to fill gaps left by an economic crisis that was prompted by sub-primes derivatives, which, until days before the bubble burst, were rated AAA" by these selfsame agencies.