The House and Senate conferees worked hard to today to reconcile their versions of financial reform. Agreement was reached on private funds, insurance regulation and the merger of bank regulators. A sticking point was on Subtitle C of Title IX which covers credit rating agencies. I’d like to recommend to Chairman Barney Frank and others that they propose [...]
Filed in Creativity, Launching..., Liquidity, Open engines, Regulatory, Restructuring, Transparency
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Also tagged confidence, Congress, credit ratings, equivalent disclosure, Fitch, NRSRO, Reg FD, Regulatory, regulatory abritrage, S&P
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From Chicago Public Radio… This American Life… ~~~~ Since Congress hasn’t held 1930′s-style hearings into the causes of the financial crisis, we stage one of our own. The subject? The regulators and watchdogs who were supposed to be overseeing the banks and the finance industry—to make sure things wouldn’t blow up like they have. Clearly [...]
Wednesday, April 29, 2009
~~~~”McDaniel this month defended the credit raters’ issuer-pay model at an SEC roundtable in Washington, saying that investors can pressure ratings companies just as easily as underwriters….”*~~~~ This will become the central argument in defense of the “issuer pay” model for credit ratings agencies…. The SEC receives information from credit rating agencies as part of [...]
Filed in Launching..., Open engines, Regulatory, Restructuring, Transparency
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Also tagged ABS, Bear, BofA, CDO, Citi, Congress, dealers, Fitch, Goldman Sachs, JP Morgan, Lehman, MBS, Merrill, Morgan Stanley, NRSRO, ratings, S&P, SEC
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Wednesday, April 15, 2009
The SEC credit ratings roundtable will be webcast here… Here is the agenda… and some coverage from the WSJ.com…
US and global bond markets have been in deep distress. The reverberations have been manifested in the worldwide banking system. Substantial public and private capital has been injected into the banking system to stabilize the largest banks and other financial institutions. Lawmakers have been examining issues in the banking and finance areas. The flow of [...]
Everyone has missed the main point of the problem of the Federal Reserve mandating the use of ratings from Moody’s, S&P and Fitch for the TALF program … the problem is rating shopping… Which means that issuers of the securities that the Federal Reserve is buying have shopped around for the best ratings… selectively disclosed [...]
Filed in Liquidity, Open engines, Recession busters..., Regulatory, Restructuring, Transparency
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Also tagged AIG, Bear, Federal Reserve, Fitch, Goldman Sachs, Lehman, Morgan Stanley, NRSRO, ratings, S&P, SEC
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From Fast Company… ~~~~ FreeRisk: Crowdsourcing Credit Ratings? BY Kermit Pattison Fri Apr 3, 2009 at 11:00 AM The recent financial meltdown demonstrated that credit rating agencies were blind to the dangers ahead. Toby Segaran of Metaweb Technologies and Jesper Andersen of the Open Data Group hope that crowdsourcing and transparency can help fix this mess. They [...]
UPDATE:US Sen Bill Would Make It Easier To Sue Credit-Rating Firms Of DOW JONES NEWSWIRES ~~~~ “WASHINGTON (Dow Jones)–Credit-rating agencies could become more susceptible to class-action lawsuits if they knowingly or recklessly misrepresent the risks of the securities they rate under a pending Senate proposal. Sen. Jack Reed, D-R.I., who chairs the Senate Banking Securities [...]
Bloomberg is reporting that new efforts are being made in Congress to rein in the dominant rating agencies… specifically it looks like legislation would remove the First Amendment protections that raters have stood behind when deflecting liabilities for their opinions… this would be a substantive change in the business and welcome… ~~~~Reed Seeks Expanded Liability [...]
From my comments to the SEC on raters…. Is the proposed application of the rule to prospective credit ratings, i.e., credit ratings that are initially determined on or after June 26, 2007, appropriate and do commenter’s believe it would provide meaningful information if the rule was limited to credit ratings made on or after that date? [...]