Not exact matches
Given the whipsaw that I experienced in 2002 when the
ratings agencies went from long - to short - term, I can tell you it did not add value, and that most
bond manager that I
knew wanted stability.
The credit
rating agency then proceeded to give these
bonds AAA
Ratings (The highest) even
know they included subprime loans (they have recently had to downgrade, which causes even more problems).
When I worked in the investment department of a number of life insurers, every now and then I would hear one of the portfolio managers say, «We
know that the
rating agencies are going to downgrade the
bonds of XYZ Corp, but we like the story.
As with any investment, it is important to understand the work of the
agency or enterprise that is issuing the
bonds and
know the credit
rating of the issue.
The credit analysts at the
rating agencies often
knew their stuff, giving considerable insight into the
bonds, but may have been hemmed in by rules inside the
rating agency regarding the
rating.
The
bond buying program,
known as Quantitative Easing (QE), was designed to lower longer - term borrowing
rates by buying U.S. Treasuries and
agency mortgage - backed securities (MBS).
Ratings agencies make bond ratings and warnings of potential rating changes known by issuing press releases and posting the information on their Web
Ratings agencies make
bond ratings and warnings of potential rating changes known by issuing press releases and posting the information on their Web
ratings and warnings of potential
rating changes
known by issuing press releases and posting the information on their Web sites.
If the civil case determines that S&P was not acting independently from business concerns, experts say legislation could be enacted to force
ratings agencies to alter their business models, ensuring that they
no longer profit from the companies whose
bonds are
rated but by the investors who use the
ratings.