Via memeorandum, a story about the newspaper industry:
Newspaper and newspaper groups are likely to default on their debt and go out of business next year — leaving “several cities” with no daily newspaper at all, Fitch Ratings says in a report on media released Wednesday.
“Fitch believes more newspapers and newspaper groups will default, be shut down and be liquidated in 2009 and several cities could go without a daily print newspaper by 2010,” the Chicago-based credit ratings firm said in a report on the outlook for U.S. media and entertainment.
That is all well and good, and I am sure people who run good newspapers will thrive and survive, but this story reminded me of something I have been meaning to ask for a long time- when are the credit ratings folks going to pay a price for their hand in the current financial mess?
Seriously? Lots of people have lost their collective asses, lots of business and banks have gone under, the federal government (you and me) is spending trillions to shore up this sector of the economy to avert total collapse, corporate CEO’s are being bashed every day in the media and on blogs, everyone hates Wall Street, but as far as I can tell, one group of people has gotten away with their perfidy- the credit ratings companies. Why is Moody’s still in business? Fitch? Standard & Poor? Why are any of them? Aren’t they the ones who greenlighted everything at the end of the day with their triple AAA raitings on these crappy mortgages repackaged as shiny new bonds? Why are they not paying a price for their incompetence and malfeasance? Didn’t they look at a bunch of shit sandwiches, proclaim them to be steak, suck up a bunch of fees, and then look the other way? After Enron, Arthur Andersen and others took it in the shorts, but the credit ratings industry seems to have gotten away completely unscathed.
I don’t want to unfairly tar and feather here, so if I am wrong, tell me, but aren’t these guys partially to blame? And if so, why is no one talking about that? Why have we not seen any new regulations or a new regulatory framework? Is everyone going to walk away from this without paying a price? Everyone, of course, except for the taxpayer?