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This was one of the major issues I was concerned with during the major credit crisis. The accuracy and dishonesty of the credit ratings for mortgage packages was of significant concern to me, and I didn't think it received the amount of coverage it deserved.
Now it appears to be getting a bit more attention:
“The ratings agencies weakened their standards as each competed to provide the most favorable rating to win business and greater market share,” according to the report. “The result was a race to the bottom.”
It's no different than what the accounting firms were doing around the time Enron crashed. Giving clients "bad news" gets you fired and that's not how you make partner....no you have situations like enron, Phar-more, AIG and so on and so forth.
It's no different than what the accounting firms were doing around the time Enron crashed. Giving clients "bad news" gets you fired and that's not how you make partner....no you have situations like enron, Phar-more, AIG and so on and so forth.
They need to change the compensation process, how these firms are hired and paid.
They also need to prosecute those who changed ratings.
Wow, I didn't think I'd ever see derivatives of the word "honest" in economic discussions any more. The concept of Honesty has no relevance in commerce or economics. You do what you are criminally obliged to do under creatively interpreted contract law and arbitrary executive orders from the justice department in order to avoid being sent to the penitentiary, and everything else is up for grabs.
Not sure when the American people will wake up and realize its us vs them. Them as in the banks and anyone they are in cahoots with. They ruined the world, they get bailed out, bonuses while Americans suffer. There was no regulation, no nothing. They did as they pleased.
Pathetic. So much for ethics.
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