SeeTheLight

Moody's Makes a Bad Situation Worse

I don't claim to be an expert. But the past 2 years the economy has still been growing (albeit at a slow growth rate). We are about to see major layoffs and a recession. Second of all, the housing values are still falling, anyone with balloon mortgages up for renewal are likely 100% foreclose and repos. All of this leads me to believe the delinquency rate is going to continue to grow. Your own figures show that.. 24 Billion losses to date, 38 Billion in the pipeline, and probably a bigger slice of the pie in the future. Once the introductory rates disappear, delinquency is going to accelerate. Plus the US can not keep these artificially low interest rates forever. This a foreclosure perfect storm.

The 77% delinquency rate is probably high, but at the same time I think you are severely low balling the severity. The past numbers don't imply the increased risks that are just beginning to materialize. It is getting worse, not better.

As for the downgrade. Well gosh gee, its part of the risk that you take when you invest in a company that Moody's may screw up and give a downgrade that isn't fully justified. Suck it up princess. Think that analysts don't downgrade stupidly? Of course they do. If you assume that the rating companies are perfect and aren't going to be overly cautious in this environment, well I think you might be in the wrong business. Boo hoo, I lost some money. This club is crowded, but hey come on in.

As for prosecuting or investigating, get in the litigation line-up, this crisis will keep lawyers busy for the next 20 years.

I apologize if this was a bit harsh at times, but I am really tired of people blaming pointing fingers at everyone except themselves. It was a housing bubble and you were blind to it. All these risks were there. You are responsible for your investments, not THEM (whoever you think they are). Caveat Emptor. I've lost money in this whole mess, but I know other people are greedy and unethical and are all trying to look out for #1. That is the world we live in. It will not change no matter how much regulation there is or how much you want it to be fair. I accept the blame that I am the only one truly responsible for my money. The possible criminal actions of others is just part of the risk in any investment. It is not fair but that is how it is in life.

I suggest next time you consider the counter party risk that there are shady operators out there and that there will be another scandal down the road.

Just my opinion.