(2007-08-22) Mortgage Rating Cycle

The Credit Rating agencies are leaning toward downgrading the Hedge Fund-s and other groups that are heavily invested in Sub-Prime Mortgage Debt. Ironically, those same agencies were late in downgrading the bonds that those Hedge Fund-s have invested in. Conflict Of Interest? Complex System fun. I'm certain there is at least one major hedge fund out there at least as rightly concerned about a collapse in Moody's as the other way around,'' said Colin Negrych, a principal at Barclay Investments Inc., a broker-dealer in New York. "To see Moody's make forward-looking negative statements about hedge funds, who may well be suffering in large part as a result of their reliance on Moody's now evidently worthless ratings, is to witness the height of chutzpah.''

Here's another view, looking at the broader Money implications of this increase in Debt Financing.