Friday, March 12, 2010

Blumenthal Grandstanding Says Peter Schiff

CT Attorney General Richard Blumenthal, just filed a lawsuit against Moody's Investors Service and Standard & Poor's. Blumenthal alleges that "they misled investors about the soundness of certain types of investments and unfairly reaped hundreds of millions of dollars in revenues." Blumenthal said that they lied.

How nice.

And what was he waiting for to initiate this lawsuit?
Did he like, finally wake up from some AG coma?
Perhaps he was waiting for a chance to grandstand and grab some headlines during his campaign, and actually make it look like he is doing something useful as CT's AG.

Blumenthal sued Moody's, S&P and Fitch Inc., in July 2009 accusing them of illegally giving municipalities lower credit ratings than they gave to similarly performing corporations. He claimed there was a "dual rating system" that ended up costing taxpayers millions of dollars in unnecessary bond insurance and higher interest payments. Not much has happened with that pending lawsuit. Which is par for the course as our illustrious AG usually initiates lawsuits to get front page news and then you never hear anything about it again.

But I digress....

You know, Schiff made a speech to mortgage bankers back in 2006 where he warned attendees of the Western Regional Mortgage Bankers Convention about how the ratings agencies "were assigning investment grade ratings to securities [that] would become worthless." He has been saying it for years.

Schiff put out a statement today about Blumenthal's lawsuit.
"It's too late. Why did Blumenthal wait until now to file this lawsuit?

Because he's running for the U.S. Senate and sees an opportunity for headlines.

This political grandstanding is everything that's wrong with politicians. If he really wanted to help the Connecticut taxpayers, he would have sued these ratings companies years ago and had the foresight to prevent the housing collapse.

Where was Blumenthal back then when such lawsuits might have actually helped avert the crisis?

Just like all the other career politicians, either Blumenthal did not want to disrupt the housing gravy train that temporarily enriched Wall Street and Main Street, or he did not know enough about economics or finance to understand the problem."

Again, Peter Schiff is spot on in his assessment.
He is someone we need representing CT in Washington.
And if we send him to Washington, Washington will NEVER be the same!