Unleashing a whirlwind

Standard & Poor's says it is to be sued by the US government over the credit ratings agency's assessment of mortgage bonds before the financial crisis.

The civil lawsuit would focus on S&P's high ratings in 2007 for some mortgage-backed securities that later collapsed in value, said the agency.

S&P says the case is entirely without factual or legal merit.

The suit would be the first such case over alleged wrongdoing by a ratings agency tied to the financial crisis.

So in today’s world and the threat to the world’s stability comes not from the Mad Scientist but from a new nemesis, best described as the Rogue Banker.

 

Working away not in laboratories but behind banks of computer screens these would be Masters of the Universe were also trying to dominate the world through their own form of financial engineering.

 By developing trading instruments and programmes of ever increasing complexity such as Collaterised Debt Obligations (CDOs), they created monsters which just like Dr Frankenstein they could not control.