We have completed maintenance on DiscoverMagazine.com and action may be required on your account. Learn More

More Defensive Reasoning By Standard & Poors

The Intersection
By Chris Mooney
Aug 10, 2011 3:38 PMNov 20, 2019 3:53 AM


Sign up for our email newsletter for the latest science news

These people have the power to wipe out a trillion dollars in wealth just by changing a rating. Yet they are balking at an SEC requirement that they disclose errors in their calculations--claiming they can police themselves. This quotation says it all:

Barbara Roper, director of investor protection for the Consumer Federation of America, said that [Standard & Poor's internal correction policy] has proven inadequate. "What was their correction policy on their Enron rating? What was their correction policy on their Lehman rating? What was their correction policy on their Bear Stearns rating? They don't have an error correction policy -- they have an error denial policy, and the SEC is absolutely right to step in," Roper said.

Revealingly, the other two top ratings agencies--Fitch, and Moody's--don't have the same problem with the proposed SEC policy of disclosing rating agency errors. Read more here.

1 free article left
Want More? Get unlimited access for as low as $1.99/month

Already a subscriber?

Register or Log In

1 free articleSubscribe
Discover Magazine Logo
Want more?

Keep reading for as low as $1.99!


Already a subscriber?

Register or Log In

More From Discover
Recommendations From Our Store
Shop Now
Stay Curious
Our List

Sign up for our weekly science updates.

To The Magazine

Save up to 40% off the cover price when you subscribe to Discover magazine.

Copyright © 2024 Kalmbach Media Co.