It is not a question of quality control or knowledge… it is solely about wise prudence

Sir Mr Blaise Ganguin from Standard and Poor’s Ratings Services is in his right to defend his company like he does in “Analysis of S&P’s ‘quality control’ is freely available” December 22. But, even accepting that all he writes is 100% the truth that does not diminish the fact that no matter how good the credit rating agencies are at what they do, it is still plain madness to empower so few with so much power over the market.

In January 2003 in a letter published by FT I wrote “Everyone knows that, sooner or later, the ratings issued by the credit agencies are just a new breed of systemic error to be propagated at modern speeds. Friends, please consider that the world is tough enough as it is.”

Well here we are years later facing an enormous financial crisis that will have tragic consequences for hundreds of million people around the world, and where the credit rating agencies triple-As can be identified as having directly provoked 50 Bernard Maddof' losses or more. We are now long overdue returning the rating agencies to where they were before the financial regulators in the Basel Committee super-empowered them.

Simply put, the nanny is not to be trusted.

There is nothing like some triple A ratings awarded to lousy securities and a Bernard Madoff experience to help a new generation of financiers to grow up and learn the hard way that their nanny is not to be trusted.

But it is also amazing to watch a society that has invested billions in paying the best tutors for their brightest to learn now being reduced to placing ads wanting a stricter fräulein… to trust.

And their names are?

Sir as the Financial Times has done Bernie Madoff should indeed be named and shamed. But, what about the naming and shaming of those financial regulators of the Basel Committee who caused immeasurably more damages by having concocted the idea of empowering the credit rating agencies as official guides; and which doomed the world, sooner or later, to follow some triple-A stars over a precipice.

Those who felt for Madoff just trusted the green lights!

Sir John Gapper enters the world of incredulity and gullibility trying to explain the Bernie Madoff affair in “Wall Street insiders and fool’s gold” December 18.

Gapper completely forgets to mention that this incident occurred in a time zone when the financial expert consensus was that risk could be diversified away into the arms of those who could handle the risks, with little or nothing said about who these blokes might be; and the financial regulators, the supreme authorities, committed the most extreme act of incredulity and gullibility of empowering the credit rating agencies… and then these officially appointed masters of the risk lured away trillions into the swampland of the badly awarded mortgages to the subprime sector.

Comparatively speaking, in these times, asking why people put their trust in Madoff is more like asking someone who has been overrun by a car why he trusted the green light.

Mr. Gapper, if “with hindsight the whole affair seems deeply implausible” start by asking yourself why you believed that the credit rating agencies could save the world from “insiders and fool’s gold” and, if you did not gullibly believe so… why did you not speak out?