We’ve been hearing a lot about rating agencies, and Standard and Poors in particular. You might have the general idea that the ratings they give bonds are a lot like your credit score. The lower the bond rating, the lower the credit score, the harder and more expensive it is to borrow money. But how exactly do these places work? And how might their judgment be corrupted? Marketplace’s Paddy Hirsch explains in this video using his trusty whiteboard and dry-erase marker.
How Do Credit Rating Agencies, Like Standard And Poors, Work?
By Ben Popken August 9, 2011
More From Consumerist
- Would You Break Up With Someone For Having A Bad Credit Score?
- 3 Things We’ve Learned About How Demographics, Credit Scores & Marital Status Affect Your Car Insurance Rates
- Will Costco’s Switch From American Express To Visa Affect My Credit?
- Regulators Propose Changes To 5-Star Safety Ratings To Incorporate More Crash-Prevention Technology
- CFPB To Banks: Offer More “No Overdraft” Checking Accounts, Provide Accurate Credit Information