Monday, December 21, 2009
The Misadventures of Moody's: Touting The Hartford, Mangling MetLife
Most analysts don’t have the access to the company financial records that Moody’s Investors Service, Standard & Poor’s and Fitch do when they formulate their credit ratings. Theoretically that should make them smarter than the rest of us.
But only theoretically. Each of the three big rating agencies got a black eye from its failure to understand, predict or provide insight into the real estate market crash that led to the recession. While the raters narrowly missed increased federal regulation, insurance regulators went after them with a vengeance, and now use Pimco as their rating agency of choice on the $145 billion portfolio of residential mortgage-backed securities that insurers currently hold.
So one can only wonder about Moody’s latest prognostication: downgrading the largest and arguably the healthiest U.S. life insurer, MetLife, by one notch to the fourth lowest credit rating...
BNet: The Misadventures of Moody's: Touting The Hartford, Mangling MetLife
But only theoretically. Each of the three big rating agencies got a black eye from its failure to understand, predict or provide insight into the real estate market crash that led to the recession. While the raters narrowly missed increased federal regulation, insurance regulators went after them with a vengeance, and now use Pimco as their rating agency of choice on the $145 billion portfolio of residential mortgage-backed securities that insurers currently hold.
So one can only wonder about Moody’s latest prognostication: downgrading the largest and arguably the healthiest U.S. life insurer, MetLife, by one notch to the fourth lowest credit rating...
BNet: The Misadventures of Moody's: Touting The Hartford, Mangling MetLife
Permalink posted by markw @ 5:29 AM 
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