This paper will explore how the fifi nancial regulatory structure propelled these three credit rating agencies to the center of the . bond markets—and thereby virtually guaranteed that when these rating agencies did make mistakes, those mistakes would have serious consequences for the fifi nancial sector. We begin by looking at some relevant history of the industry, including the series of events that led fifi nancial regulators to outsource their judgments to the credit rating agencies (by requiring fifi nancial institutions to use the specififi c bond creditworthiness information that was provided by the major rating agencies) and when the credit rating agencies shifted their business model from.
