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Just wanted to re-visited a previous topic and that is the
Standard & Poor’s downgrading of U.S.
At the time I said that they had ulterior motives for doing
that because they don’t get paid for doing that, it does not mean shit to the
world economy (US still the safest place to put your money) and no other rating
agency followed their lead.
What they knew was coming down the pike was a government
investigation into their rating of toxic assets sometimes known as CDOs or
collateralized debt offerings.
If you remember, these financial instruments are what
brought our housing and banking industry down. People were granted mortgages
for no valid reasons by mortgage brokers that would turn around and sell the
mortgages after making a handsome commission, to others who collected those
mortgages and wrapped them up into CDOs and sold it to investors.
This would work fine if everyone paid their mortgage on time
and paid those mortgages off in time but because the people paying those
mortgages should not have received those mortgages in the first place because
they were not qualified financially to obtain a mortgage, those CDOs collapsed.
Now Standard & Poor rate financial instruments such as
CDOs as to their credit worthiness, i.e. are they a safe investment or not. Well
Standard & Poor rated those toxic assets as investment grade which prompted
many to invest, taking their word for it.
Well Standard & Poor gets paid by the people trying to
sell those toxic assets so obviously, they are not going to rate them
un-buyable and here is where we have a problem with conflict of interest.
I feel that Standard & Poor should be in jail for what
they did to the country because if they did their due diligence (did their job)
we would not be in as big a mess as we are.
S&P downgraded the US
Somebody on Wall Street needs to start paying for what
happened and S&P, the arrogant little bastards, is a great place to start.
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