What I don't understand about Standard and Poors is

[pnwmom]

how did they get all this power? Why are they -- and the other two ratings agencies -- the ultimate arbiter of all things financial? No one elected them. No one in government appointed them.

So why do we cede any power at all to them?

[still_one]

1. Doesn't appear they have all that much power. People are flocking into U.S. treasuries, sorry bill

gross, looks like your perpetual bear calls are wrong again

[indurancevile]

2. same reason we allow credit rating agencies to tell us whether we can have jobs

or rent houses. same reason we allow ourselves to be frisked to get on airplanes, or held in "free speech zones".

who decided that?

the people with the money, that's who.

[Ruby the Liberal]

3. While not defending them, the role they play (or are supposed to)

is to do the legwork on the financials and managerial inner workings of sovereign nations and publically traded corporations so that investors don't have to invest that time themselves. As such, they are ripe for corruption (as 2007/8 showed us plain as day).

Let me ask you this - what would you prefer to competing private ratings agencies for this role, eliminate them and let the Randian "free hand of the market" take over (as we 'know' people will "always do the right thing for the right reasons in the end") or eliminate them and appoint a corruptible, politically driven (given party in power) government agency to over see this all. Kinda like the SEC under Bush that was asleep at the switch (while not watching porn on the government dime) in 2008.

Hell, we can't even get a CFPB chief nominated in this political climate.

They may not be all that and a slice of cheese, but I will take them over the alternatives.

[pnwmom]

4. How about a non-profit, non-partisan organization.

We trust the CBO to make non-partisan determinations. Why couldn't we trust another non-partisan organization to do what Standard & Poors does?

[Ruby the Liberal]

5. Only (and I mean ONLY) if they were above the political fray.

CBO is an excellent example - thanks for that as I will be filing it in my brain for future use on this topic. I for one am a huge fan of regulation and always looking for concrete examples of what is working.

My only concern goes back to the aforementioned CFPB. Not only are they refusing to even consider a nominee for the post, but by the time they get one that they will agree to question, dude/dudette will likely be so horribly corrupted that they will do a fraction of what Liz Warren envisioned. (Thats me projecting given my disgust with DC right now).

If by some miracle, they could set up an economics agency to be above political frays, I would not only applaud them, I would apply to self-relocate and work for them. Yes, I feel that strongly about it.

[customerserviceguy]

6. It's the same reason that Consumer Reports has power

Do a good job long enough, and people have faith and confidence in what you put out. Even when you start to go off track, you still have a core of believers willing to give you some credibility.

[banned from Kos]

7. they were selected - by Congress in 1975

those three alone.