I wish I were talking about a different place and time, but I mean here and now.
I have no sympathy for Standard & Poors, as I have been blogging for years, they are one of the guilty parties in pumping up the real estate bubble, the bursting of which brought us the foreclosure crisis that is not yet over.
And which caused tens of thousands of bankruptcies.
Hey, you may be thinking, didn’t the manure hit the fan on this in the summer of 2008? Why, yes, you are correct!
The short version is, the Wall Street crooks and Fannie Mae and the politicians they bought gave anyone who could fog a mirror a mortgage. Appraisers who were honest were driven out of business. Crooked mortgage brokers profited; the banks were happy, they sold the mortgages before the ink was dry and booked the profits. The mortgages were packaged into securitized trusts, and Goldman Sachs and the other crooks sold them to unsuspecting customers.
How did Standard and Poors fit in?
For about three years, the government has been investigating whether S&P managers pushed to weaken company standards for rating mortgage-linked deals or ignored the standards entirely, people familiar with the probe said.
Nobody buys the crap unless it is rated. And the ratings agencies, including S & P, rated it just under U. S. government debt, the highest stuff they rate.
The bulls–t thing about this is, though the Wall Street Journal says the investigation has been ongoing for a while, the suit comes only after S & P, rightly, downgraded U. S. government debt, and ignored the King’s warning about doing that.
S&P suggested Monday it was being unfairly singled out. The CDOs under scrutiny were given the same high ratings from an S&P rival, the firm said. S&P added that it faced charges for not predicting the full extent of the housing bust, “despite [the] failure of virtually everyone to do so.”
They should have been sued way back when, and prosecuted criminally. Instead, the King does not want anyone knowing how shaky its own ability to repay its debts is, so, the suit gets filed.