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U.S. Inquiry Eyes S.&P. Ratings of Mortgages

pbrauer

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I would love to see the Justice Dept. bring justice to these fraudsters who were responsible for crashing the economy.

The Justice Department is investigating whether the nation’s largest credit ratings agency, Standard & Poor’s, improperly rated dozens of mortgage securities in the years leading up to the financial crisis, according to two people interviewed by the government and another briefed on such interviews.

The investigation began before Standard & Poor’s cut the United States’ AAA credit rating this month, but it is likely to add fuel to the political firestorm that has surrounded that action. Lawmakers and some administration officials have since questioned the agency’s secretive process, its credibility and the competence of its analysts, claiming to have found an error in its debt calculations.

In the mortgage inquiry, the Justice Department has been asking about instances in which the company’s analysts wanted to award lower ratings on mortgage bonds but may have been overruled by other S.& P. business managers, according to the people with knowledge of the interviews. If the government finds enough evidence to support such a case, which is likely to be a civil case, it could undercut S.& P.’s longstanding claim that its analysts act independently from business concerns.

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http://www.nytimes.com/2011/08/18/b...focus-on-s-p-ratings.html?partner=rss&emc=rss
 
They just lowered their debt rating and now this is happening? Lol! These guys couldn't be more predictable.
 
This is going to be another Obama train wreck if he pursues this action. It is obvious retribution and only sullies the credibility of the United States.
 
Other then the fact that this has been stated over and over again before this action


S&P most likely did commit fraud in rating the agencies, the timing of this action is horrible and should have been done long before now
 
This should have been done two years ago. S&P isn't the only one. Unfortunately it now only looks like sour grapes.

All the same I would hope the truth comes out but I'll be that this is as far as it goes.
 
S&P most likely did commit fraud in rating the agencies, the timing of this action is horrible and should have been done long before now

So did numerous other ratings agencies and financial institutions. The DoJ isn't going to go over them all because not only will they not be able to prosecute them successfully (partly because they're all buddy-buddy with them), but it would also reveal how messed up the DoJ and SEC are.
 
So did numerous other ratings agencies and financial institutions. The DoJ isn't going to go over them all because not only will they not be able to prosecute them successfully (partly because they're all buddy-buddy with them), but it would also reveal how messed up the DoJ and SEC are.
Quite true and the other agencies should see similar actions
 
Cmon people, RTFA . There are 3 separate investigations into S&P. The justice department was already investigating S&Pbefore getting the downgrade. The SEC had also been investigating all 3 major rating agencies. Congress is investigating the S&P specifically for misconduct in dropping the AAA rating.
 
I have to admit I have wondered if the S&P made this move to downgrade to AA+ for strictly got some political reason knowing they has a $2 trillion math error.

You have to ask yourself if it was not done to hurt Obama because he called Wall Street arrogant and greedy.

It dose seem to be payback to me, making it hard to understand id that if it is payback did S&P not think about the affect this downgrade was going to have on the whole economy?

S&P had assets worth $2.61 billion dollars in 2009 and think they are paid by Wall Street firms to rate them you would think they would the last one to do anything that would hurt the A&P 500.

I'm baffled.
 
It's possible that it was a pre-emptive move on their part. Perhaps the investigations were getting somewhere and they figured this was the best way to combat it. That would hurt the so and so created the downgrade arguements but they have shown they have no idea how to grade squat.

I'm not about to defend them.
 
Could be the downgrade was a response to the federal investigation, not the other way around. In which case, maybe the downgrade ought to be investigated, as well.

The fact remains, though, that the blame game gets us no closer to the goal. We either make a level playing field that leads to producing more goods domestically, or we continue to suffer the effects of an economy that is now based on secondary bets on mortgages and commodities. The former enables wealth to trickle up and down. The latter will result only in constant volatility and widespread malaise.
 
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