MyATMPinIs1234

We're From the Government, and We're Here to Help

Some of you might've heard about this sub-prime mortgage debacle. A large part of the problem was that the ratings agencies, who are in charge of judging how risky a bond is, don't have any idea what they are doing. But at least they have to compete with each other for business.

"Now, while more than one ratings firm reviews most deals, not all of them always rate the deal and get paid (WSJ 6/4, C1)."

Fine, it's clearly not an ideal system, since de-facto, the government only allows 3 ratings agencies, and there are some conflicts of interest... but don't worry, the government has a solution for fixing it!

"Under the Cuomo settlement, which would cover the hardest-hit portions of the mortgage market, the firms would get paid for their review, even if they didn't end up getting hired to rate the deal."

His bright idea is to just pay everyone! Hurray! Thanks for fucking up, here's your huge payday! So now, the ratings agencies still don't have to be competent but now they don't even have to compete with each other.

Btw, the Cuomo in question is not Mario, the former NyGov. It's Andrew, his son, the Attorney General of New York (AGONY), who got the job because of his intellect and experience.

"In a statement, Deven Sharma, S&P's president, said the firm `is pleased to work with New York Attorney General Andrew M. Cuomo and other rating agencies on these important measures, which we believe will help ensure our ratings process continues to be of the highest quality.'"

No shit he's pleased. He just Jedi Mind Tricked the FUCK out of AGONY Cuomo.