The Limits of Sovereign Ratings in Light of the Greek Debt Crisis of 2009–2010

This chapter explains why the CRAs failed to anticipate the Greek debt crisis of 2009–2010 and maintained views that diverged from the market’s during the crisis. Section 10.1 presents a review of the literature. Section 10.2 compares Fitch, Moody’s, and SP second, the use of ratings in regulatory capital standards, which served to inflate investment-grade sovereign ratings. Section 10.4 concludes.