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Rating the Rating Agencies

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  • Reinhart, Carmen
  • Goldstein, Morris
  • Kaminsky, Graciela

Abstract

In this study, we begin by assessing the ability of sovereign credit ratings to anticipate crises. In addition, given the wave of sovereign credit ratings downgrades that have followed the crises in Asia, we investigate formally the extent to which credit ratings are reactive. Along the way, we discuss a small but growing literature that examines to what extent financial markets anticipate crises.

Suggested Citation

  • Reinhart, Carmen & Goldstein, Morris & Kaminsky, Graciela, 2000. "Rating the Rating Agencies," MPRA Paper 24578, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:24578
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    References listed on IDEAS

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    More about this item

    Keywords

    credit ratings; default; crisis; downgrades; prediction; banks; currency;

    JEL classification:

    • F4 - International Economics - - Macroeconomic Aspects of International Trade and Finance
    • F34 - International Economics - - International Finance - - - International Lending and Debt Problems
    • F32 - International Economics - - International Finance - - - Current Account Adjustment; Short-term Capital Movements
    • F3 - International Economics - - International Finance
    • F31 - International Economics - - International Finance - - - Foreign Exchange
    • F36 - International Economics - - International Finance - - - Financial Aspects of Economic Integration

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