Argentina wants no more rating agencies

Credit rating agencies are at the root of the financial problems and should be gotten rid of, Argentine Economy Minister and Vice President-elect Amado Boudou said. \"As long as they exist, resources will continue to flow from those who have less to those who have more,\" Boudou said at a seminar on the global economic developments sponsored by the World Bank and the Argentine Economy Ministry. Credit rating agencies weren\'t always as influential as they are now, Boudou said. Before the 1990s, he said, \"credit rating agencies didn\'t have the kind of relevance they have today and the financial system still worked the way it should.\" Getting rid of the credit rating agencies, which he called \"a source and transmission of problems\" is the answer and an imperative, Boudou said. \"As long as credit-rating agencies exist, resources will continue to flow from those who have less to those who have more. And this diminishes the possibility to create jobs and strengthen the domestic market,\" he said. \"When a small percentage of the population holds a large percentage of the country\'s wealth, this affects their possibility to generate their own domestic markets and create aggregate demand.\" Boudou also advocated stronger state intervention in the economy which, he said, enabled Argentina to overcome financial problems while \"Europe still can\'t find a way out of it.\" Argentina went through a period of economic political turmoil from the late 1990s to 2002, marked by periods of military rule and weak civilian governments, before it was forced into a sovereign default. The recovery has been slow and marred by further political problems. But in October President Cristina Fernandez de Kirchner won a second term with an overwhelming majority, giving the government more confidence to carry through economic reforms. Boudou and other senior Argentine officials say that part of the problem was too much dependence on market forces, including market reactions to rating agencies, and too little effect of government decisions. The Argentine officials also like to compare the European situation today to how it was for Argentina less than a decade ago. \"It\'s clear that the markets work deficiently but it\'s a pattern that proves that the more deregulation there is the more deficient the markets are,\" Boudou said. Boudou\'s comments follow harsher criticism of the ratings agencies from European officials, who have moved toward tougher regulation of the agencies\' work. The rating agencies were thrown into spotlight in \"Inside Job,\" Charles Ferguson\'s Academy Award-winning documentary film analyzing the 2008 global financial crisis. The film traced the emergence of a rogue culture within the finance industry which the film maintains has corrupted politics, regulation and academia. At a cost of more than $20 trillion, the documentary said, the crisis caused millions of people to lose their jobs and homes in the worst recession since the Great Depression and nearly triggered global financial collapse.