Fed Loans Guided by Raters Grading Subprime Debt AAA

Can you believe this????? Bernanke's assessment of who qualifies for the tarp dough that he is doling out by the hundreds of billions of dollars is relying on the credit assessment of none other than the rating agencies who brilliance (read greed) led to the destruction of the western world. Only the rating agencies have done a better job in fooling people than good ole Bernie.

ps. Herd on the Cliff: Bernie Madoff turned down the job. He was tied up.

By Alison Fitzgerald

Dec. 18, 2008

Federal Reserve Chairman Ben S. Bernanke is basing hundreds of billions in emergency lending on credit ratings from companies that gave AAA grades to toxic securities.

The Fed has purchased $308.5 billion in commercial paper and lent $631.8 billion under eight credit programs, most of which require appraisals of short-term debt and loan collateral by “major nationally recognized statistical ratings organizations.” That, in effect, means Moody’s Investors Service, Standard & Poor’s and Fitch Ratings.

Read Full Article at: http://www.bloomberg.com/apps/news?pid=20601109&sid=ahpPBA8vqN2o&refer=home

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