The SEC is Investigating S&P for Insider Trading on the Downgrade

First they go after A&M and now they go after S&P?

Slive is greedy as heck.

 

It gets better. Don't mess with the Government. LOL

http://money.cnn.com/2011/08/18/news/companies/sp_investigation_mortgages/index.htm?hpt=hp_t1

 

Got to catch all those crooks...

DD

 

Do you condone the government bullying S&P?

 

Do you condone S&P falsifying ratings and then letting its employees engage in insider trading?

Because if not it's curious how people think deregulation is suppose to improve corporate behavior.

S&P clearly has done some shady stuff - should the gov't not investigate or are you saying the SEC should be shut down?

 

The irony of this is that if people knew S&P was going to downgrade the US and traded off that information they would have LOST money.

The monday following the downgrade, investors flocked to US Treasuries pushing up prices and lowering yields further.

S&P rated over 16,000 securities AAA between 2000 and 2008 to show you the failures in the asset backed securities markets. Just an FYI, only a few publicly traded US companies are AAA including MSFT, ADP, Johnson & Johnson and Microsof. 15,990 down including governments.....what were the rest??

And how much in fees did you make to rate those securities?

 

I think you could easily have predicted that there would be a significant panic equity sell off though. Maybe not as bad as it turned out, but there was going to be a knee jerk reaction for sure.

 

word on the street is that s&p was already being investigated regarding the mortgage crisis and therefore by downgrading uncle scam, in case they were formally charged they could now say it was nothing more than vengeful payback for said downgrade

 

I heard a reporter on BBC who spoke with people with S&P who were interviewed in connection with this last summer, well before the downgrade.

 

The issues with the tentacles of the ratings agencies is many institutional pension plans and investment policy statements require holding a certain percentage of AAA investments as per S&P/Moody's etc.

So some institutions will be forced to sell US Treasuries and replace them with other AAA rated securities which could cause some short-term sells and reductions in prices. Some may want to pre-empt the rest and do so early, similar to when S&P adds a stock to the S&P 500.

 

I have to admit that it looks like Obama's SEC got pissed after the downgrade.

Conceivably the S and P did the downgrade so they could claim retaliation when hte ongoing investigation gained steam. You don't have to be a scheming genius to plan that out. Who knows.

When all is said and done they do need to be investigated.

The SEC has acted totally disracefully and subserviently to the corporate elite, so any sign of life is appreciated. It has functioned recently like a mere career stepping stone, to get some experience, court some corporate employers without pissing them off and then cash out by switching to the corporate side.

Oh, they went after Martha Stewart. I forgot.

 

what are they being investigated for, sucking? i mean seriously, these guys have missed every major financial crisis since s & l's and junk bonds.

 

Possible insider trading: i.e. whether anyone who knew of the downgrade news first made trades based on that news before it was released.

 

kicking myself for not posting this..........I called this one (to my wife) the day they announced the downgrade. Just knew it would happen. (not that it required much of a crystal ball)

 

No, I don't think so. There's no way they actually move that fast. This is probably a culmination of months of work or deliberation. Maybe the downgrade was a catalyst to get a green light on an effort that was on the brink anyway.

NPR interviewed someone the other day who was under-impressed. He said the SEC hasn't deployed enough manpower to really do a major investigation.

 

This is not even remotely true. Do you know how equity markets work?

 

Anonymous has just released ~1GB of breached personal emails from a former Vice President of a large DoD contractor and ex-FBI agent. The material purportedly belongs to Richard Garcia, a senior vice president at Vanguard who was a U.S. Federal Bureau of Investigation (FBI) special agent for 25 years. Of note as it pertains to this thread:

 

Whether the result of isolated incidents or a systematic falsification, this has to bring S&P's credibility into question. If a handful of individuals could do this much damage, then their system is broken. If it was company-wide nefarious dealings, then their system is broken. Either way, S&P is screwed on many, many levels.