US Government Rated Lower Than Securities Backed by Subprime Home Loans

The latest disgrace, brought to you by President Downgrade and Helicopter Ben:

Standard & Poor’s is giving a higher rating to securities backed by subprime home loans, the same type of investments that led to the worst financial crisis since the Great Depression, than it assigns the U.S. government.

S&P is poised to provide AAA grades to 59 percent of Springleaf Mortgage Loan Trust 2011-1, a set of bonds tied to $497 million lent to homeowners with below-average credit scores and almost no equity in their properties. New York-based S&P stripped the U.S. of its top rank on Aug. 5, saying Washington politics were making the country less creditworthy.

No doubt Michael Moore will seize on this as further evidence that the folks at S&P should be frog-marched onto a train to Siberia. But even a security backed by subprime home loans is worth more than loans for $zillions backed by nothing more than Ben Bernanke’s printing press and Comrade Obama’s Hope & Change.

helicopter-ben-bernanke
Not inspiring confidence.

On a tip from The MaryHunter. Cross-posted at Moonbattery.

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