… Moodys.
Irony. Palpable.The need to have a AAA rating to be eligible “for government programs raises the specter of rating shopping,” Andrew Kimball, head of the global structured finance business at Moody’s Investors Service, said during the company’s investor day today. “Those programs don’t differentiate on the quality of the rating. Rating shopping becomes a problem.”
Via Dealbreaker. Story in full at Bloomberg…
Moody’s are complaining because the TALF requires only one rating as opposed to the more traditional two from separate agencies. Having only one, says Moody’s, incentivises rating shopping, with the market rewarding the least stringent agency.
We’re just rather reminded of comments made by the CIO of Global CDOs at Fortis, Maryam Muessel and released by the House Oversight Committee last October:
…if the ratings are b.s. the only use in ratings is comparing b.s. relative to more b.s.