From Rolling Stone:
It's long been suspected that ratings agencies like Moody's and Standard & Poor's helped trigger the meltdown. A new trove of embarrassing documents shows how they did it
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 of us suspected.
Thanks to a mountain of evidence gathered for a pair of major lawsuits by the San Diego-based law firm Robbins Geller Rudman & Dowd, documents that for the most part have never been seen by the general public, we now know that the nation's two top ratings companies, Moody's and S&P, have for many years been shameless tools for the banks, willing to give just about anything a high rating in exchange for cash.
In incriminating e-mail after incriminating e-mail, executives and analysts from these companies are caught admitting their entire business model is crooked.See also:
"Lord help our fucking scam . . . this has to be the stupidest place I have worked at," writes one Standard & Poor's executive. "As you know, I had difficulties explaining 'HOW' we got to those numbers since there is no science behind it," confesses a high-ranking S&P analyst. "If we are just going to make it up in order to rate deals, then quants [quantitative analysts] are of precious little value," complains another senior S&P man. "Let's hope we are all wealthy and retired by the time this house of card[s] falters," ruminates one more.
Ratings agencies are the glue that ostensibly holds the entire financial industry together. These gigantic companies – also known as Nationally Recognized Statistical Rating Organizations, or NRSROs – have teams of examiners who analyze companies, cities, towns, countries, mortgage borrowers, anybody or anything that takes on debt or creates an investment vehicle.
Their primary function is to help define what's safe to buy, and what isn't. A triple-A rating is to the financial world what the USDA seal of approval is to a meat-eater, or virginity is to a Catholic. It's supposed to be sacrosanct, inviolable: According to Moody's own reports, AAA investments "should survive the equivalent of the U.S. Great Depression."
The Scam Wall Street Learned From the Mafia
It's not a stretch to say the whole financial industry revolves around the compass point of the absolutely safe AAA rating. But the financial crisis happened because AAA ratings stopped being something that had to be earned and turned into something that could be paid for....MORE
JOBS Act: Matt Taibbi Has Become a Grumpy Old Man
Matt Taibbi: "How HSBC hooked up with drug traffickers and terrorists. And got away with it"
"Matt Taibbi Now Resorting To Calling Goldman Sachs Fat " (GS)
Matt Taibbi: "How Wall Street Killed Financial Reform"
And some of the old Taibbi:
Taibbi: "Surprise Winner in Thomas Friedman Porn-Title Contest"Gawker are also fans of the older stuff
Matt Taibbi's Relentless Hounding of Tom Friedman Continues, Thankfully
The 2012 piece on Friedman is a lighthearted romp through the state of punditry in America or at least the Upper East Side, as the case may be.In 2005, Matt Taibbi wrote a takedown of NYT mouthbreather Tom Friedman's unique idiocy that remains the greatest thing ever written about the mustachioed private-jet-frequent-flyer. Now Taibbi has a new piece; top ten anti-'stache material.His original story was all about The Earth is Flat, and why Tom Friedman is a rich asshole who butchers the English language and is not particularly bright....MORE
