How would customers and investors, especially small investors, be able to rate banks?
This would be no different from any other business. Again, banking presents no special problems in this area. Customers are able, e.g., to buy cars without being automobile engineers. Banks, too, would have an incentive to display important traits about themselves to customers and rating agencies. Banks that do not do so or are known to deceive the public and rating agencies would tend to lose customers and public confidence. (Rating agencies would depend on their reputation for accuracy and honesty. Thus, a rating agency that was either incompetent or dishonest would lose its credibility. After all, a rating agency’s product is accurate and clear information about whatever it rates. On a free market, people would be free to patronize only those rating agencies they believed to be competent and honest.) Investors, even small ones, would also be able to rate banks, either through third parties rating agencies again or just by looking at publicly available information. This would be no d
