Ontonix: Rating the Rating Agencies–Moody’s “A3” rating
Monday, 31 October, 2011 Leave a comment
Moody’s is the largest of the Big Three rating agencies. It employs 4500 people worldwide and has reported a revenue of $2 billion in 2010. Since rating agencies have been under heavy fire since the start of the financial meltdown – in January 2011 the Financial Crisis Inquiry Committee claimed that "The three credit rating agencies were key enablers of the financial meltdown" – we have decided to actually rate one of them. We have chosen Moody’s because today it is the largest rating agency.
However, in rating Moody’s we have not rated it’s financial performance or its capacity to honour it’s financial obligations or it’s Probability of Default. In other words, we have not performed a conventional rating which, as we claim, is not relevant in a turbulent economy. What is more relevant in turbulent times is resilience – the capacity of a business to withstand and survive sudden and extreme events. In fact, our ratings actually measure the resilience of a business based on the structure of its financials.
For the analysis we have used our on-line self-rating system. Anybody can use this system to rate any company.
We have used information from Moody’s Investor Relations page, available here. If anyone wishes to verify the results of our rating it is possible to do so by simply downloading the financial information and processing it using our mentioned self-rating system. The process, in other words, is fully transparent.
To see the results click on the graphic:
For “more” here is a link to a very recent blog: Ontonix: Ratings – From an Opinion to Science