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View Diary: Balkin: There will be no default, as the president already is using the 14th Amendment (362 comments)

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  •  Timeline suggests downgrade threat connected (3+ / 0-)
    Recommended by:
    oneshot, TheMomCat, gc10

    to attempts to escape liability for S&P's  part in the mortgage crisis. All those AAA ratings of mortgage backed junk bonds. If they're legally liable they're up the creek.
    Prior to Dodd-Frank the courts found rating agencies' ratings were expressions of opinion.  They were not legally liable for misleading or false ratings.    Dodd-Frank was signed July 2010.  With Dodd-Frank rating agencies now have legal liability for their ratings, including misleading ratings. (Remember Arthur Anderson Accounting firm ? The lawsuits for damage from their  accounting approval of bad accounting practices at places like Enron put them out of business.)  S&P issued it's first downgrade threat in October 2010.  Is their real goal exemption from regulation and legal liability by threatening the credit rating of US bonds?
    Good rundown at Firedoglake.

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