• Jake On The Rating Agencies

    By • Feb 20th, 2008 • Category: Pure Content

    Another great review from Jake Zamansky on the role of the ratings agencies in the subprime crisis.

    Investors: Beware any time a market player has a government protected, exclusive franchise to print money.

    My take on this from the perspective of the Big 4 later coming later today.

    Ordinarily we would just let market forces deal with such failure. However firms like Moody’s, Standard & Poors, and Fitch are granted special competitive advantages because they are part of a select group of eight companies designated as Nationally Recognized Statistical Rating Organization (or “NRSRO”). Based on their record, the government should not be protecting them.

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    2 Responses »

    1. Francine:
      You sound just like me, “Beware ….” Consider what that implies for Helicopter Ben and the Feds.

    2. […] today, I pointed you to an article by Jake Zamansky on the role of the ratings agencies in the subprime crisis. I would also point you to Jim […]

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