RealPoint's Borderline Criminal Disclosure Of Truth Deserves A Spanking
Frequent Zero Hedge readers are aware of our fascination by the ethically pure and intellectually honest legacy rating agencies (read S&P and Moody's), whose primary goal in life is to provide readers of its reports with unconflicted, unbiased research, without regard for the top and bottom line of key Wall Street firms, which purely by accident happen to be the biggest sources of revenue to these same NRSRO via structured products which are spun off from the banks' balance sheets and sold to highly sophisticated, erudite yet unfortunately bankrupt island nations (which luckily have a monopoly on geysers and 6 foot tall women to feed their GDP). The complete transparency that shrouds the work of these rating agencies, and the integrity of its professionals is beyond reproach, and where, contrary to litigation disclosure, the phrase "let's hope we are all wealthy and retired by the time this house of cards falters", was massively taken out of context and was simply referring to an intern's attempt at recreating the Sistine Chapel using nothing but 10 decks of Bicycle cards.
Which is why we read with dread and horror the following press release from RealPoint, which has the dubious distinction and being one of the few NRSROs that provide abhorrently objective and distressingly unbiased analysis on all matters structured.
Yesterday's SEC action, granting Nationally Recognized Statistical Rating Organizations (NRSROs) with access to the necessary underlying data that will allow competing credit rating agencies to offer unsolicited ratings for structured finance products, is one of the most important reforms undertaken by the government in response to the role of the major credit rating agencies in the credit crisis.
This development will increase competition in the highly-concentrated credit ratings industry because the offering information on all structured finance products will be required to be distributed on a presale basis to all NRSROs. Thus far, only the rating agencies selected by the issuers of the securities received the data on a presale basis, thus shutting out other NRSROs from providing any type of presale analysis. The proposed changes regarding improved access to information will also allow NRSROs to conduct better surveillance of structured finance products on an on-going basis.
"This change will provide more choices for investors, who will now be able to choose an agency based on the quality and transparency of its ratings and analysis," said Robert G. Dobilas, CEO and President of Realpoint. Realpoint's revenues are derived primarily from investors who subscribe to Realpoint's credit analytics service, which provides investors with monthly ratings updates and comprehensive credit reports on all current CMBS transactions.
"With more ratings agencies analyzing the creditworthiness of these securities, there will be less ambiguity and less chance for some to take advantage of the system. Ultimately, investors will be provided with a better understanding of the risk profile of structured finance investments," added Mr. Dobilas.
We, as well as all of you, dear readers, should be fully aware by now, that the respected former Fed Chairman Greenspan was never singlehandedly responsible for, and the rating agencies had no involvement in, creating what some fringe, tin-hat bloggers call a Ponzi market manifesting in such spurious phenomena as credit and housing bubbles. Neither is his successor, who prudently and presciently called the economy's endless upward trajectory repeatedly, currently engaged in recreating just this presumably dubious arrangement, and whose actions day after day simply conform with what is in the US economy's best interest: namely a strong dollar, a vibrant middle class, and balance sheet transparency where such things as SIVs and off balance sheet items are not even defined in the Oxford English Dictionary. Which is why Zero Hedge looks with great skepticism on any attempts by the likes of grossly competent RealPoint to highlight what may be some justification of the repeated lies by alternatives of the one true source of objective, raw and unregurgitated primary data and spot on economic analysis, known as CNBC. After all, rating agencies have never had a monopoly in what has been fraudulently claimed as repeated information manipulation. And even if they did, the even more objective, unbiased and thoroughly unrelated to Wall Street professionals working for the Securities and Exchange Commission, would never have allowed such a purported travesty to occur in the first place. Lest it be forgotten, the mission of the U.S. Securities and Exchange Commission is to
protect investors; maintain fair, orderly and efficient markets; and
facilitate capital formation. In fact, the watchdog agency refers to itself as
"the investor's advocate." One can not honestly believe that such enlightened words could have even an iota of hypocrisy in them.
Which is why we say, boycott RealPoint, boycott their products, when you see them coming, cross the street and snub your noses in their general direction. Their vague attempts to undermine what is, at its core and periphery, a fair, efficient, and well-regulated system will fail, for ever and ever, with the blessings of the greatest organizations ever to grace the face of the planet: the Federal Reserve and Goldman Sachs.