Moody's: Right on top of things again
Can't for the life understand why the market is reacting to the Moody's downgrade of Greek debt to junk. The market has known Greek bonds were risky for months. It's Moody's that was clueless, assigning an "A3" grade to Greek bonds. Says Wiki:
A1, A2, A3 Moody judges obligations rated A as "upper-medium grade", subject to "low credit risk",[7] but that have elements "present that suggest a susceptibility to impairment over the long term".[8]
Beautiful. "Subject to low credit risk." And Lehman Brothers, according to Moody's, was "A1."
Comments
So, we are to *finally* believe Moody's ratings after the stellar job they did in rating the bonds created by the securitization of mortgages?
"The Big Short" is an eye opener to how incredibly bad the bond ratings agencies tend to be.
Posted by: JJT | June 14, 2010 9:03 PM