new credit threat to banks, page-29

I will give my take. I have no doubt that Standard and Poors, Moodys, etc, have dismally failed in their role. IMO they should be taken for a row and a new specialist not for profit division of the US government/fed be setup to take over from them.

But I don't think these ratings agencies are the absolute cause of this mess, more of a nagging symptom.

The cause is more broad based IMO and relates to America's shocking education system-A system based upon wealth rather than intelligence and ability. Only those that can afford to go to Harvard, Yale, UCLA, etc, do so, not neccessarily are they the brightest. Yes there are scholarships, but they're limited. Then you have to think of it in context where America has failed even more dismally-healthcare. Who can go uni when it costs an arm and a leg, but look out, if you break an arm or a leg your going to be up to your head and shoulders in debt? Only the very well off in most cases. These two failures of the American system are a cancer that grew too large.

And so it seems, such 'privaleged' graduates were at the forefront here, in ridiculous, often FRAUDULANT, lending practices to those have nots, who understandably wanted more, but did not know they were not in a position to do so.
This practice IMO, is what brought the house (prices) down, card by card. And to make it twice as bad, the ratings agencies gave the whole lot an A+, selling granite for the price of diamonds, to Europe and parts of Asia.