Why Is S&P Giving Subprime Bonds A Higher Rating Than U.S. Debt?
"U.S. Treasuries -- widely believed to be the safest investment in the world -- don't make the cut, but subprime mortgage investments do? What gives?
Subprime mortgage-backed securities are the same class of assets that fueled the housing bubble and triggered the 2008 financial crisis. According to a 2010 report by the Senate Permanent Subcommittee on Investigations, the main ratings agencies fell over themselves to give these bonds AAA ratings, then abruptly downgraded them to junk status after mass mortgage delinquencies made maintaining the false ratings untenable. "
Subscribe to:
Post Comments (Atom)
Normally I don't post things from social media outlets.
Like many sites, LinkedIn has its share of cesspool and idiocy. That being said, this came up, and it does reflect a lot of what I have both...
No comments:
Post a Comment