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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: ggersh who wrote (18558)	12/24/2016 7:56:57 PM
From: Elroy	Read Replies (2) \| Respond to of 33421

The fraud comes from packaging the investments as Triple A while at best they were junk and the banks knew it cause they bet against them. Who declared the investments Triple A? I thought that was the ratings agencies job. And did the banks bet against the packages, or the banks let their customers bet against the package? My understanding is the latter. It was something like the customer said "Put this type of package together, I'm sure the ratings agencies will do a bad job and rate is AAA, but I the customer think it is actually junk, so I the customer will get against the buyers of the package. Even in that scenario, it's not clear to me what the bank has done wrong. As long as all the info about the mortgages is accurate, the bank isn't responsible for someone else's (or their own even) rating. The buyers of the package have equal ability (in theory) to come up with their own "rating".