I’m shocked and disappointed to learn that S&P has been suspended from providing ratings in the commercial mortgage market for a period of time.
The latest fines and restrictions against S&P are part of a long series of moves by governments around the world to curb the ability of markets to function freely with open information. Governments benefit from restrictions because they gain more control of market outcomes. Customers and investors should decide whether S&P’s opinions are credible, there is no need for governments to step in.
At the heart of S&P’s business is their credible opinion. Their credibility is based on the trust investors and other market participants have in them. If S&P provides lousy ratings not grounded in honest research and objective opinions, then less people will be willing to pay S&P for their ratings. Its up their customers to determine the fate of S&P.