Yahoo Answers is shutting down on May 4th, 2021 (Eastern Time) and beginning April 20th, 2021 (Eastern Time) the Yahoo Answers website will be in read-only mode. There will be no changes to other Yahoo properties or services, or your Yahoo account. You can find more information about the Yahoo Answers shutdown and how to download your data on this help page.
Trending News
Would the investment banks have bought sub prime loans if they were not able to have them sold them rated AAA?
It appears to me that the AAA rating assigned to bonds, made up of sub prime mortgage securities, made the sub prime loans feasible. After all if the investment bankers could not sell the sub prime mortgage bonds why would they buy the sub prime loans in the first place? The investment bankers probably knew they could get the credit rating agencies into assigning the AAA rating. Then investors would be confident they were buying a safe conservative investment that was rated AAA from the investment bank.
It appears that the AAA bond rating is the linchpin in whole sub prime structure.
What do you think?
2 Answers
- Anonymous1 decade agoFavorite Answer
Your right it is. That issue is already known and the CRA has been criticized for it. They were putting AAA ratings on high risk CDO's.
- npkLv 71 decade ago
Absolutely no doubt that the credit rating companies were as guilty as sin in the CDO fiasco. They were putting lipstick on pigs and pronouncing them beauty queens.