Breaking news via Zero Hedge
EU LAWMAKERS APPROVE AMENDMENT TO END USE OF CREDIT RATINGS
It is always amazing to me that so many people view the government as a reasonable fix for perceived failures in private accountability systems. Government officials are the worst about avoiding accountability.
Update: The point that Basel II/III has big discrete jumps in capital requirements for small shifts in bond ratings is a reasonable observations. Smoothing this out makes sense, but there is more than this that needs to be fixed in the Basel requirements (particularly the now largely dated idea that any assets are "risk-free"), which played a huge but largely unsung role in inflating the demand in the last decade for AAA rated mortgage bonds.