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WSJ: Why Credit Raters Keep Their Power [Depsite Being Totally Useless and Probablt Complicit]

Financial-Overhaul Law Was Supposed to Reduce Their Influence; Idea Looked Good on Paper

By JEAN EAGLESHAM And DEBORAH SOLOMON

Curbing the influence of credit-rating firms, a goal of this year's financial overhaul, is so far proving easier said than done, reflecting the industry's deeply embedded role in the financial system.

One example: Though many U.S. banks suffered losses on mortgage-related deals blessed by ratings firms before the crisis erupted, some financial institutions have been lobbying against a provision in the Dodd-Frank financial-regulation law passed in July that bans the use of ratings in federal agencies' rules.

Regulators now use ratings to assess the risk of assets, such as mortgage-backed securities, in determining how much capital banks must hold against potential losses.

Banks contend that alternative approaches, including coming up with their own risk assessments, could have unintended consequences.

http://online.wsj.com/article/SB1000142405274870367000457561...



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Where is that video....

of the guy in the EU government bad mouthing the credit rating agencies.....

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