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Proposed European credit rating agency set to give American “big three” competition

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Proposed European credit rating agency set to give American “big three” competition

German Chancellor Angela Merkel recently called for a new European credit ratings agency.

AP/Geert Vanden Wijngaert

American credit ratings agencies recently downgraded Greece, Portugal and Ireland’s debt to junk status, making it harder for the EU to avoid an economic meltdown. In Europe, there’s growing discontent over these agencies’ unchecked power. Earlier this week, German Chancellor Angela Merkel called for the creation of a new European credit ratings agency.

Markus Krall, an economist at Roland Burger in Germany who's leading the effort, tells us how it would work.

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