Friday, August 17, 2007

Sounds About Right To Me

Via Norwegianity, we get Paul Krugman's take on the housing problem. What I'm worried about is that the least among us will again suffer at the hands of corporate greed & criminality.
For it is becoming increasingly clear that the real-estate bubble of recent years, like the stock bubble of the late 1990s, both caused and was fed by widespread malfeasance. Rating agencies like Moody’s Investors Service, which get paid a lot of money for rating mortgage-backed securities, seem to have played a similar role to that played by complaisant accountants in the corporate scandals of a few years ago. In the ’90s, accountants certified dubious earning statements; in this decade, rating agencies declared dubious mortgage-backed securities to be highest-quality, AAA assets.
My emphasis.

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