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Thread: U.S. sues S&P over subprime ratings

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    U.S. sues S&P over subprime ratings

    not that I actually think any bankster will go to prison but still - it is a step in the right direction. A direction toward correcting the fallacious notion that Wall Street cares very much about honest behaviour.

    Feds sue S&P over subprime ratings - Feb. 5, 2013

    The Justice Department announced a lawsuit Tuesday against Standard & Poor's over its inaccurate ratings of investments tied to subprime mortgages in the run-up to the financial crisis.

    The suit represents the first federal action in connection with the crisis against one of the country's major ratings agencies, which have long been cited as key culprits in the meltdown.

    The Justice Department accuses S&P of giving deceptive ratings to mortgage securities between 2004 and 2007 that greatly underestimated the risk to investors. It did so, according to the suit, in order to collect fees from the firms that were pooling the risky home loans into securities.
    more from Bloomberg - Default in 10 Months After AAA Spurred Justice on Credit Ratings - Bloomberg
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    Re: U.S. sues S&P over subprime ratings

    Both sides are a bunch of gangster ridden hacks, with the government likely getting its instructions from Paul Krugman who's been critical of S&P.
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    Re: U.S. sues S&P over subprime ratings

    Quote Originally Posted by American View Post
    Both sides are a bunch of gangster ridden hacks, with the government likely getting its instructions from Paul Krugman who's been critical of S&P.

    and what's wrong with getting "instructions from Paul Krugman" (which they haven't but that's another story)? On the economic front he has been proven right more than any Austrian dreamer.
    “And I have no doubt that every new example will succeed, as every past one has done, in shewing that religion & Govt will both exist in greater purity, the less they are mixed together.”
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    Re: U.S. sues S&P over subprime ratings

    You think it is a mere coincidence that only S&P, yet not ANY of the other rating agencies, are "partially at fault"? This looks a lot like a political threat to S&P (and by extension the other rating agencies) not to downgrade Obama's very low interest gravy train. When the rated pay the fees of the raters then what other outcome was expected? If rater A gets "honest", and drops the rating, then they will be dropped and rater B will get that business. Hmm...

    United States federal government credit-rating downgrade - Wikipedia, the free encyclopedia
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    Re: U.S. sues S&P over subprime ratings

    While I would hardly be surprised if the motivations for this suit are corrupt, I'm not going to look a gift horse in the mouth. The rating agencies engaged in fraud by giving out AAA ratings to products they knew were crap and profited from doing so.

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    Re: U.S. sues S&P over subprime ratings

    ...But what about Moody's and Fitch?

    ...This couldn't be revenge for downgrading US debt during the debt ceiling standoff?

    ...

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    Re: U.S. sues S&P over subprime ratings

    Quote Originally Posted by Somerville View Post
    not that I actually think any bankster will go to prison but still - it is a step in the right direction. A direction toward correcting the fallacious notion that Wall Street cares very much about honest behaviour.



    more from Bloomberg - Default in 10 Months After AAA Spurred Justice on Credit Ratings - Bloomberg
    Yeah cause blaming the rating agencies is so much easier than cleaning house in DC to fix the built in problems those idiots legislated into the system.

    Ratings agencies rated them highly because they expected GSEs to be backed by the full faith and credit of the US and in the end, they were. If they were not the government shouldnt have been hip deep into the banking business. Although, it ought to be interesting watching two pigs engage in a mud slinging contest---both sides are pretty dirty, the financial sector and the enablers in DC that wanted easy credit.

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    Re: U.S. sues S&P over subprime ratings

    Quote Originally Posted by Somerville View Post
    not that I actually think any bankster will go to prison but still - it is a step in
    the right direction. A direction toward correcting the fallacious notion that Wall Street cares very much about honest behaviour.



    more from Bloomberg - Default in 10 Months After AAA Spurred Justice on Credit Ratings - Bloomberg
    Wow, just wow. Eric Holder helped enforce the anti " redlining" policies that helped create the massive democrat mandated sub-prime bubble.

    You know when asking people for a down payment and refusing people that had poor credit history was deemed "racist".

    Lol...the banks. Please. This administration is full of people that are directly responsible for the meltdown including the Democrat Congress.

    Its a offesive diversion. Holder did the same thing when he went after Wells Fargo because they maintained their standards and didnn't give into the Democrat thugs who threatened banks.

    Unreal how poorly educated some people are on this subject.

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    Re: U.S. sues S&P over subprime ratings

    Quote Originally Posted by rathi View Post
    While I would hardly be surprised if the motivations for this suit are corrupt,
    I'm not going to look a gift horse in the mouth. The rating agencies engaged in fraud by giving out AAA ratings to products they knew were crap and profited from doing so.
    They gave them AAA ratings because those MBS were backed by the United States Govt through the GSE's.

    Or did you forget by the time the dust cleared the GSEs were up to their eyeballs in toxic MBSs

    The bought them, they bundled them, they sold them to investment bankers.

    This is Chicago thug politics BECAUSE a Rating decreasre on our bonds is right around the corner.

    That makes Captain dumbshyt look bad you know.

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    Re: U.S. sues S&P over subprime ratings

    Quote Originally Posted by Fenton View Post
    They gave them AAA ratings because those MBS were backed by the United States Govt through the GSE's.

    Or did you forget by the time the dust cleared the GSEs were up to their eyeballs in toxic MBSs

    The bought them, they bundled them, they sold them to investment bankers.

    This is Chicago thug politics BECAUSE a Rating decreasre on our bonds is right around the corner.

    That makes Captain dumbshyt look bad you know.
    When S&P gives a loan a AAA rating, they are making a good faith claim that they believe it has a low risk of default. They are not saying "its a piece of junk but don't worry the government will bail you out anyway".

    S&P made fraudulent claims when they gave crap mortgages AAA ratings and they should be brought to justice for it. I am not unaware that the motivations for the lawsuit may be corrupt, but that doesn't make the case invalid. Its extremely common for the government to do the right thing for the wrong reason.

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