Shouldn't S&P executives be in prison rather than trying to use their firm's now-destroyed reputation to push for cuts to ordinary Americans' economic safety nets?
http://www.bloomberg.com/news/2011-04-13/moody-s-s-p-caved-to-mortgage-pressure-by-goldman-ubs-levin-report-says.htmlMoody’s, S&P Caved In to Ratings Pressure From Goldman, UBS Over MortgagesBy Zeke Faux - Apr 13, 2011 7:24 PM ET
Moody’s Investors Service and Standard & Poor’s adjusted the way they graded securities after Goldman Sachs Group Inc., UBS AG and at least six more banks pressured them, according to a U.S. Senate report.
The world’s two largest bond-ranking companies, both based in New York, made exceptions to rules when bankers asked for better safety ratings on complex mortgage-backed securities, the Senate Permanent Subcommittee on Investigations said yesterday. When Moody’s and S&P changed their assessments of hundreds of those bonds in July 2007, it helped trigger the financial crisis, the panel said.
“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.”
The conclusions cap a two-year investigation into the financial crisis during which senators questioned executives about the failings of Wall Street banks, regulators and mortgage companies. In a televised hearing last year, lawmakers compared Goldman Sachs bankers to bookies and subcommittee Chairman Carl M. Levin grilled them about marketing securities. Levin’s committee wants regulators to eliminate rules shielding Moody’s and S&P from being sued over flawed ratings and publish accuracy rankings for the companies.
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