Commentaries

A limit to Kraft’s sweet tooth

September 8, 2009

Cadbury’s swift rejection of Kraft’s $16.7 billion offer has set off widespread speculation that Kraft will bump up its bid to ensure that it becomes king of candy land.

Breaking the credit ratings habit

July 22, 2009

How many times do investors need to rail against rating firms’ credibility before things really change? Standard & Poor’s set off the most recent round of vitriol on Tuesday after it raised the ratings on bonds backed by commercial mortgages back to sterling AAA just a week after it cut them. It tweaked its assumptions after investors complained about the downgrades.

Fitch comes out swinging on California

July 6, 2009

Fitch Ratings is at it again. The credit rating firm cut California’s general obligation bonds by two notches to BBB, leaving the rating just two notches above junk. Fitch had already cut the state’s full faith and credit bonds one notch on June 25.

California stares at possible ratings downgrade

June 19, 2009

It was only a matter of time before another ratings agency weighed in to warn that California could see its rating slashed if it doesn’t get its fiscal house in order soon. Moody’s Investors Service said that the state’s rating could be put on the chopping block for multiple downgrades.

Really, a new type of rating will make a difference?

June 15, 2009

The Obama Administration’s expected to require rating agencies to differentiate the ratings it applies to corporate bonds and more complicated securities to give investors a heads up that some debt is not the same as others.  Wall Street, unsurprisingly is opposed to the idea, since it could sap demand out of the already lackluster securitization business. But, this all seems a bit silly. If investors need a different rating to let them know what they are investing in, they’ve hardly learned much from the debacle of the last two years.