Castigate the regulators
Mr Pietro Calice writes that “Sanctions and enforcement rules are needed to regulate the rating agencies”, FT July 11, but what seems most needed are sanctions and enforcement rules to regulate the regulators. How many financial regulators have been fired having been found sleeping on their job after they outsourced the watch out to the rating agencies? None? Yep!
To me there are clearly none more responsible for the current calamities than the regulators that thought up the crazy idea that it is possible to drive risks out of banking forcing the banks to heed the specific opinions of the credit rating agencies and without creating even larger systemic risk.
These regulators though they perhaps should not be sent to jail, should at least be named, shamed and fired… otherwise all talk of accountability is just a farce. If an impossible construction is contracted out who is really guilty when the construction falls?
To me there are clearly none more responsible for the current calamities than the regulators that thought up the crazy idea that it is possible to drive risks out of banking forcing the banks to heed the specific opinions of the credit rating agencies and without creating even larger systemic risk.
These regulators though they perhaps should not be sent to jail, should at least be named, shamed and fired… otherwise all talk of accountability is just a farce. If an impossible construction is contracted out who is really guilty when the construction falls?
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