Moody's lowered its credit ratings on $5.2 billion of bonds backed by subprime mortgages yesterday. Standard & Poor's may do the same for $12 billion in securities.
This week and last, Moody’s has been taking heat for waiting too long to respond to the housing bust. They’ve now downgraded 399 bonds. S&P’s threat puts another 612 at risk. In their press release, S&P said they expect home values will decline 8% on average between 2006-2008.
“On the numbers,” reports Eric Fry of Rude Awakening, “the U.S. economy is slowing, the U.S. dollar is faltering, the housing market is limping, the mortgage market is withering and the leveraged world of credit-derivative exotica is imploding. The last of these worrisome items fascinates -- and worries -- us the most.”
This week and last, Moody’s has been taking heat for waiting too long to respond to the housing bust. They’ve now downgraded 399 bonds. S&P’s threat puts another 612 at risk. In their press release, S&P said they expect home values will decline 8% on average between 2006-2008.
“On the numbers,” reports Eric Fry of Rude Awakening, “the U.S. economy is slowing, the U.S. dollar is faltering, the housing market is limping, the mortgage market is withering and the leveraged world of credit-derivative exotica is imploding. The last of these worrisome items fascinates -- and worries -- us the most.”
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