Moody's Rating Agency mock-up

Moody's Rating Agency Look at Crypto

By Tomadachi | Tomadachi | 9 Oct 2021


Today, the Moody's rating corporation have posted job adverts on LinkedIn searching for a Senior Blockchain Analyst and a Crypto-Asset Analyst.

Moody's Senior Blockchain Analyst vacancy

Moody's Crypto-Asset Analyst vacancy

Images: LinkedIn

Moody's have been a major plank in the structure of Finance 1.0 for over 100 years.

They themselves describe themselves on LinkedIn as "...a global integrated risk assessment firm that empowers organizations to make better decisions. Our data, analytical solutions and insights help decision-makers identify opportunities and manage the risks of doing business with others. We believe that greater transparency, more informed decisions, and fair access to information open the door to shared progress. With over 11,000 employees in more than 40 countries, Moody's combines international presence with local expertise and over a century of experience in financial markets."

Anyone Remember?

Those of you who can remember the 2008/09 global financial crisis will no doubt recall the 'negligence' of the rating agencies such as Moody's, Standard & Poor's, and Fitch Ratings who all failed to report on the risk associated with Bear Stearns, Lehman Brothers and all the interconnected financial parties.

Negligence is the polite word used by mainstream media to describe the action of the rating agencies during this period.

However, this brief video clip from the movie The Big Short tells you all you need to know about how rating agencies really work.

Without the high approval scores provided by the big 3 ratings agencies, the complex mortgage-backed securities could not have been sold in the first place.

By keeping ratings as high as Triple A for these products, these 'overseers' permitted money markets and pension funds to purchase the worthless securities.

It is estimated that Triple A ratings were given to over three trillion dollars worth of loans to homebuyers with bad credit and/or undocumented incomes (Ninja became a slang name for these homebuyers -No Income No Job Applicants).

By 2010 a large percentage of these loans were downgraded from Triple A to junk status.

As usual, fines were paid, no-one was held accountable and promises were made to improve ethical standards.

After a respectable amount of time of course, as New York Time's Floyd Norris noted, standards soon reverted lower because a ratings agency "...will get more business if they are less critical than their competitors."

Finance 1.0 Overseeing Finance 2.0

If the world operated as we are told, the ratings agencies would have ceased to exist after the last financial crisis.

But, of course, the world doesn't operate as they tell you. So, the ratings agencies are still around and still part of the problem. 

At time of writing this article, 12 people have already applied to Moody's to be part of their task force monitoring blockchain and crypto.

Perhaps the 12 applicants are idealistic radicals and believe they can convert the company from one of profit-at-all-costs to becoming a beacon of openness, truth and honesty... I certainly wish them luck.

But I suspect in a relatively short time from now we shall see the next evolution of something akin to BitConnect being granted an all-important Triple A official stamp of approval.

BitConnect Triple AAA

Image: A nightmare in waiting

 

As that day draws ever closer, the OG's mantra of DYOR (Do Your Own Research) has never been more prudent.

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Tomadachi
Tomadachi

Interested in Blockchain Tech and DLT


Tomadachi
Tomadachi

Inquisitive, open and a searcher of truth... is how I see myself. Others may not be so kind in their appraisal.

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