Moody's Puts Sino-Forest Ba2 Rating On Downgrade Review, Does Not Cite Its Own Due Diligence Incompetence As A Factor

Tyler Durden's picture

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oogs66's picture

What does Moody's do?  They missed all of this too?  As debt holder its even more important to them!  Maybe Warren will buy Sino to make them look better.

Ahmeexnal's picture

And the SEC has suspended trading in several companies, including Leo's beloved solars:

http://blogs.marketwatch.com/thetell/2011/06/07/sec-suspends-17-companie...

whydtinogo's picture

I await a conflicting upgrade from Dagong

rfullem's picture

same could be said for mortgages (AAA?), greek debt (wasn't is A-?), AIG, GE. These agencies are outright dangerous - even more so than government agencies.

oogs66's picture

though in the end, it is regulators and lazy investors that give the rating agencies any power

AUD's picture

These tree growing scams always go bust. We've had several here in Australia in the last few years.

economessed's picture

Rating agencies are the toupee salesmen of the hair styling world.

GeneMarchbanks's picture

once again, things that should have been brought to my attention yesterday!!!

oogs66's picture

Moody's deserves more credit than that.  Their ratings are so stable that Sino-Forest has been rated Ba2 since July 2004.  The rating was so well thought out that it didn't adjust through any of the commodity run ups, market crashes, or anything.  S&P actually upgraded it once in 7 years. 

slewie the pi-rat's picture

hahaha!   "...feel free to piggyback on the work of 2 guys in a small office somewhere who did your job for you." 

at least the room had a view...of reality!

A Man without Qualities's picture

Am I the only one who wonders if Carson Block might not be working for the US government?  Just looking at the facts, it would make a lot of sense....

oddjob's picture

Only snivelling spineless unskilled chair moisteners work for the government.

Ergo's picture

I can imagine people looking at a commodity business with vast real estate assets in China, and thinking it makes sense to invest.  Interesting how some research questions on cash flow seem to have busted the assumptions. 

Anecdote:  There's a lot of timberland in East Texas.  It takes decades to grow something harvestable.  You buy with the ideas that (1) someday your kids may cut the trees and remember you fondly, maybe, (2) meanwhile you have a place to go hunting (although not the best in the state), and (3) it parks money you don't need somewhere it can't get lost.  And of course, land value varies wildly, and minerals are their own story.

That's just common knowledge around here.  My parents have a little timberland.  It's chief value is that it's fun to drive golf carts through the trails with our children.  Last weekend, we saw a deer, a turtle, and a beaver (which isn't so good for the trees).

aminorex's picture

There was nothing for Moody's to miss. This is all just  Carson Block running an extortion scam.  TSX:TRE is now trading for less than it's cash in the bank in  Hong Kong.  It's easy to do this to Chinese companies because they are far away and foreign, but also because there's no one to buy them up when they trade below their assets.  Weyerhauser isn't going to acquire 176,000 acres of prime old-growth in Yunnan, and the CCP wouldn't let them if they tried.  There is no M&A market, and the shares are mostly in weak hands.  The weak get ripped off all day every day, so no surprises there.  I suspect Paulson will be serving Block his vital organs on a platter, however.  Those are not weak hands.