Credit to Pascal Bouvier for highlighting this piece by Annamaria Andriotis, published 7/26/16 in the WSJ, on the re-emergence of near prime. To paraphrase her gist: Subprime consumer lending has re-emerged, with a new name to conceal the risk. But her gist doesn't jibe with the facts. Near prime, Alt-A are well established consumer ABS terms of art. Near prime dates back to the early 1990s,...
What is a song worth? Who creates the value: the songwriter, the singer, or the "star-maker machinery behind the popular song"? Perhaps all three, but how to divvy up the spoils equitably? Taylor Swift's decision to withdraw from Spotify has become a flashpoint for such questions. In...
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Clive Crook of Bloomberg View applauds Ann Rutledge and Robert Litan's Brookings study, "A Real Fix for Credit Ratings": "The [rating agencies'] failure to do their appointed jobs was as spectacular as that of the banks, and at the very center of the whole mess---yet the...
Greg Gordon of McClatchy's Washington Bureau writes about the Brookings study by Ann Rutledge and Robert Litan, which calls for a single, public, numerical (ordinal, not cardinal), benchmark credit scale. Gordon quotes a recent interview with Rutledge: "'If we don’t have objective measures of credit...
David Nicklaus, business columnist at the St. Louis Post-Dispatch, quotes Rutledge on what it would mean for structured finance to replace the familiar AAA, AA, BB etc. scale with a numerical scale: "Creating a numerical score for structured debt is like putting a speed limit on...