$6.5bn of CDOs face ratings downgrades
By Paul J Davies in London
Published: January 4 2008 19:08 | Last updated: January 4 2008 19:08
Saturday, January 05, 2008
SOMEBODY SHOULD SUE THE RATINGS AGENCIES
After all, they are the ones who handed out the AAA and AA ratings to a large part of the Big ShitPile.
The potential CDO downgrades announced Friday come as a direct result of downgrades given to nearly 800 mortgage-backed bond deals by S&P in late December. About two-thirds of the deals put on review Friday are so-called high-grade structured finance CDOs, which means they invested mostly in the safest AAA- and AA-rated slices of mortgage-backed bonds and similar securities.
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