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What about the ratings agencies? That's what "they" always say about the financial crisis and the teeming rat's nest of corruption it left behind. Everybody else got plenty of blame: the greed-fattened banks, the sleeping regulators, the unscrupulous mortgage hucksters like spray-tanned Countrywide ex-CEO Angelo Mozilo. But what about the ratings agencies? Isn't it true that almost none of the fraud that's swallowed Wall Street in the past decade could have taken place without companies like Moody's and Standard & Poor's rubber-stamping it? Aren't they guilty, too? Man, are they ever. And a lot more than even the least generous...

The United States faces a “material risk” of losing its AAA status if there is a repeat of the wrangling seen in 2011 over raising the country’s self-imposed debt ceiling, credit ratings firm Fitch said on Tuesday. The United States scraped up against its $16.4 trillion debt ceiling on Dec. 31 and is now employing special measures to meet its financial obligations. The Treasury Department said those steps could be exhausted by mid-February. Despite December’s deal by U.S. politicians to avoid the “fiscal cliff” of spending cuts and tax hikes, Fitch’s head of sovereign ratings, David Riley, said pressure on...

Gasparino actually said in plain English: 1. The 2008 Real Estate Bubble was caused in large part by the three ratings agencies 2. That Warren Buffet had ownership of Moody's and made millions at the time. 3. That the Lubrizol purchase was a continuation of a trend that Buffet has shown toward these sorts of ethical lapses in very large, economy moving transactions. So far, this is the very first time that anyone in the MSM has uttered such things, and the last place I thought I'd see it was on a Fox channel. Kudos to Gasparino for actually reporting...

The ratings agencies — all-knowing, all-seeing, omniscient — have weighed in on the U.S. federal debt “crisis,” talking about downgrading U.S. paper in anticipation of a Beltway failure to cut a deal to raise the debt ceiling, thus engendering a “default.” Oh, please. Can anyone believe that the global capital market cannot distinguish between a Greek-type situation, in which the government literally cannot service its debts, and the U.S. condition, in which a political dispute might delay some interest payments for a few days? The question answers itself. More generally, has there ever — ever– been a case in which...

The European Commission on Tuesday said it will probe credit agencies and even suggested it might take over the job of rating countries’ sovereign debt. No question, Moody’s (MCO), Standard & Poor’s (MHP) and Fitch failed miserably in analyzing mortgage securities, slapping AAA ratings on home loan packages that often turned out to be filled with junk. Issuers pay the agencies for their ratings, a clear conflict of interest. So there’s been favorable talk of a state-run ratings body, and not just in Europe. Ezra Klein, liberal blogger for the Washington Post, liked the concept, writing that, if anything, “a...

NEW YORK (Reuters) - The big rating agencies are no longer very useful to investment companies such as PIMCO, which can be faster to anticipate shifts in credit quality of debt, said the bond fund management company on Wednesday. The credit rating agencies "no longer serve a valid purpose for investment companies free of regulatory mandates," wrote Pacific Investment Management Co.'s managing director Bill Gross in a May Investment Outlook on the company's Web site

Why haven't the rating agencies that were complicit in the subprime-mortgage securities scandal suffered the fate of Arthur Andersen? Despite some moves in Congress to change their behavior, U.S. authorities are still treating the agencies with extreme gentleness. Moody's and Standard & Poor's, the two giants of the industry, are still around despite causing the loss of hundreds of billions of dollars by badly rating subprime-mortgage-backed securities. Not only that, they are basically doing business the same way, taking fat fees from the investment banks whose securities they rate. In testimony before the House Committee on Oversight and Government Reform...