Accrued Interest writes in this article, Bill Gross: Do you trust him? as follows:
No one outside PIMCO knows their position, but Gross is a savvy guy, so he is not speaking to hurt his own fund.
Jon C. Ogg points out that none of this is new information. Writing in his article, Did Bill Gross Short Sell Stocks & Bonds Via U.S. “AAA” Rating Comments?, he notes the following:
There is an exquisite irony in worrying about the S&P downgrade. This is a company vilified by nearly everyone for the failure to recognize the subprime risk, lamely giving AAA ratings to assets now viewed as “toxic waste.”
All of a sudden, we are viewing these guys as the brilliant analysts who know the potential for nations to pay back debt. Really?
There is a serious public policy issue about government “bailouts” and the debt required. It is a matter of discussion among many serious economists. We do not pretend to offer an answer–not yet. At “A Dash” we are (informed) consumers of such information.
While we are still evaluating the arguments, we can state a preliminary conclusion: The S&P ratings will not be our first choice.
Originally published at A Dash of Insight and reproduced here with the author’s permission.
One Response to “Irony of the Day: S&P Opinion on Sovereign Debt”
The rating agencies committed straight fraud, they labeled trash, for profit. They have lost their credibility and their share holders should of fired all executives/ and management and completely restructured the entire agency.If anyone could pinpoint activist in this crises it would lead right to them.And the second note is that they say they reevaluated their formulas, and the government actually uses their figures for TARP and other programs is a Sham.It proves the 1980′s the 2000′s will be the 2015. Watch out for those ratings.