What chafed me was I remembered that bond rating agencies, including Moodys and Standard and Poors, had been involved in conflict of interest and unwarranted optimism exacerbating the current economic crisis. A somewhat spicier write-up is online here.
The situation is so jacked up that rating agencies actually started claiming immunity from liability for their ratings by claiming they had free speech rights like (and no more responsibility than) a movie reviewer. Unfortunately for them (WSJ):
Manhattan federal Judge Shira Scheindlin dealt a blow to ratings firms, rejecting a free-speech defense asserted by Moody’s Investors Services and Standard & Poor’s.
Do those names sound familiar?
I am not claiming that COR's AAA ratings are fraudulent. I do think they are unlikely to stay AAA if we keep up the profligate spending, including elective project spending and overpayment of top officials. My suspicion has been that COR wanted to shoehorn in a huge bond because they know/fear/suspect that the AAA bubble will burst sooner rather than later. I sure would like to be wrong about this.
