The rating agencies received an earful for mis-rating debt obligations collateralized by tranches of securitized mortgages. Investors alleged that Moody's (MCO) and others misled them. The rating agencies reminded the investors that ratings comprise first amendment-protected speech -- opinions, if you will -- and that no one is under any obligations to accept them as fact nor rely on them as oracular truths. The markets are taking the hint.

Bloomberg describes the problem this way (Campbell and Moore, 22 June): "Moody’s Investors Service suffered a downgrade of its own as markets responded to the company’s rating cuts of 15 of the world’s largest banks by bidding up the value of their stocks and bonds...'We view the Moody’s downgrade as another overhyped story of 2012,' David Trone, analyst at JMP Securities LLC, wrote to his clients. 'The corporate market thinks for itself and credit rating agencies are often lagging indicators.'"

Turning to the Steel City Re reputation metrics, Moody's reputation ranking has rarely been greater than the median over the trailing twelve months -- a point that is quite telling for what may be the best recognized brand in the business. With respect to vital signs, Moody's is currently ranked in the 60th percentile relative to its peers, its return on equity is at the 50th percentile, is reputational volatility creeping up from the 20th to the 27th percentile, and its stability is only at the 13th percentile. Oh yes, the change of direction indicators are all negative. Times are a changin'.