Credit Rating Exec: "We Sold Our Souls to the Devil"
Internal documents show that while rating firms publicly defended their practices, executives privately wondered when the house of cards would fall. Full Story »
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This impartial investigative journalism is absolutely imperative to understand the subtle complexities of the present economic-political crisis. A "small thing" like the 1970's switch from having the payment for securities ratings go from the investors to the issuers, opened a hugeconflict of interest which helped to bring us to where we are today. Pamela de Maigret
So "conflict of interest" is to blame? No, it is a general break down in the integrity of the people running the three major rating institutions, and the people in the banks and other financial groups who withhold their business if they don't get the fraudulent ratings they need to peddle their worthless paper, and the funds who bundle this trash and then leverage their companies for 20 or 30 times the value of the junk they are putting out. It may start with dishonest ratings of dubious mortgages, but even when the Carlysle Capitol Corporation "invested" in triple A rated paper, they then leveraged their capital over 20 times -- hardly prudent business practices. Where was the oversight from the government agencies that are supposed to regulate the markets and protect the buyer? Pamela de Maigret