It was the turn of the rating agencies (well actually only Moody's) to take their turn in the spotlight at the Financial Crisis Inquiry Commission hearings Wednesday.
Here's some of the more interesting sound bites from the testimony:
'When I joined Moody's in late 1997, an analyst's worst fear was that he would contribute to the assignment of a rating that was wrong, damage Moody's reputation for getting the answer right and lose his job as a result.
When I left Moody's, an analyst's worst fear was that he would do something that would allow him to be singled out for jeopardizing Moody's market share, for impairing Moody's revenue or for damaging Moody's relationships with its clients and lose his job as a result'.
'You began to hear of analysts, even whole groups of analysts, at Moody's who had lost their jobs because they were doing their jobs, identifying risks and describing them accurately'.
Eric Kolchinsky, former Team Managing Director, US Derivatives,
Moody's Investors Service
'To be blunt, the picture is not pretty. From 1998 to 2007 Moody's revenues from rating complex financial instruments like mortgage securities grew by a whopping 523 percent. From 2000 to its peak in 2007, the company's stock price climbed more than six fold. Moody's did very well. The investors who relied on Moody's ratings did not fare so well'.
Financial Crisis Inquiry Commission Chairman Phil Angelides
'We believe that ratings were our best opinion at the time that we assigned them. The regret is genuine and deep'.
'I am much more inclined to come down hard on the CEOs of the institutions that caused the United States government to necessarily bolster them, than I am on someone (like Moody's) who made a mistake that 300 million other Americans made'.