The wages of sin

摘要

By misreading the risk in mortgage-backed securities and other "structured" products, the rating agencies Standard & Poor's, Moody's and Fitch played starring roles in the failure of finance. Their punishment? Oddly, the further entrenchment of their dominance, thanks to the Federal Reserve. The Fed's lending programmes, such as its commercial-paper facility and the Term Asset-Backed Securities Loan Facility (talf), accept only collateral that has been appraised by a "major" rating agency, ie, one of the big three.