One reason that S&P and Moody’s enjoyed such a dominant market presence is simply that they had been a part of the club for a long time. They are part of a legal oligopoly; entry into the industry is limited by the government. Meanwhile, a seal of approval from S&P and Moody’s is often mandated by the bylaws of large pension funds,25 about two-thirds of which26 mention S&P, Moody’s, or both by name, requiring that they rate a piece of debt before the pension fund can purchase it.
