Friday, September 30, 2011

The Government Attack on S&P

Since S&P downgraded U.S. government debt, the SEC has begun a review of S&P’s methodology for the downgrade and whether proper review procedures were followed.

Now, SEC inspectors are saying a large credit rating firm “appeared to allow” for a pending rating decision to be disclosed to certain people before the action was publicly announced.

Don't be surprised when S&P is announced as the agency. These type of inside tips occur on Wall Street on a daily basis and the SEC could nail any ratings agency or news service if they wanted to.

Pre-internet, I'm told a trader used to get calls just minutes before a major wire service moved market moving news across the tape.

This is one of the dangers of over-regulation. Often the government ignores violations but uses the regulations as a way to keep people in line. S&P stepped way out of line, in the government's view, and they are going to get smacked every way the government can think of smacking S&P.

4 comments:

  1. "Now, SEC inspectors are saying a large credit rating firm “appeared to allow” for a pending rating decision to be disclosed to certain people before the action was publicly announced."

    Like the voting members of the FOMC?

    "Videoconference Meeting of August 1
    On August 1, 2011, the Committee met by videoconference to discuss issues associated with contingencies in the event that the Treasury was temporarily unable to meet its obligations because the statutory federal debt limit was not raised or in the event of a downgrade of the U.S. sovereign credit rating."

    http://www.federalreserve.gov/monetarypolicy/fomcminutes20110809.htm

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  2. Funny. You have Herman Cain ads all over the site.

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  3. Anon@341pm-

    These ads are selected by Google, not EPJ. After I did a search for Goldman Sucks a few weeks ago, I saw GS ads on numerous sites.

    I've never seen a Cain ad here. The ads that run are a function of what you browse for. They are different for each user.

    Hell, 90% of the ads I see are for Ron Paul, Gold or Silver, and "Who Would You Vote For".

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  4. Anyone who comes up against the world's most powerful political terrorist organization will be destroyed. Look what these terrorists did to Toyota and Wiki-leaks and anyone else who dares try and take the punch bowl away when the economic boom party gets out of hand.

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