Inside Job Transcript - Final Version - 9.30.10 - Sony Pictures Classics
Inside Job Transcript - Final Version - 9.30.10 - Sony Pictures Classics
Inside Job Transcript - Final Version - 9.30.10 - Sony Pictures Classics
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<strong>Inside</strong> <strong>Job</strong> transcript – <strong>Sony</strong> <strong>Pictures</strong> – September 2010 42<br />
BILL ACKMAN: Moody's and S&P get compensated based on putting out ratings<br />
reports. And the more structured securities they gave a AAA rating to, the higher their<br />
earnings were gonna be for the quarter.<br />
Imagine if you went to the New York Times, and you said, look, if you write a positive<br />
story, I'll pay you 500,000 dollars. But if you don't, I'll give you nothing.<br />
01:55:48.03<br />
{JEROME FONS<br />
FORMER MANAGING DIRECTOR<br />
MOODY'S RATING AGENCY}<br />
JEROME FONS: The rating agencies could have stopped the party, and said: We're<br />
sorry – you know – we're gonna tighten our standards. This is – a-, and, and<br />
immediately cut off a lot of the flow of funding to risky borrowers.<br />
FRANK PARTNOY: AAA-rated instruments mushroomed from just a handful to<br />
thousands and thousands.<br />
01:56:09.09<br />
JEROME FONS: Hundreds of billions of dollars, uh, were being rated. You know – and<br />
–<br />
CHARLES FERGUSON: Per year.<br />
JEROME FONS: Per year; oh, yeah.<br />
01:56:16.05<br />
FRANK PARTNOY: I’ve now testified before both houses of Congress on the credit<br />
rating agency issue. And both times, they trot out very prominent First Amendment<br />
lawyers, and argue that when we say something is rated AAA, that is merely our opinion;<br />
you shouldn't rely on it.<br />
01:56:35.17<br />
DEVEN SHARMA: S&P's ratings express our opinion.<br />
STEPHEN JOYNT: Our ratings are, uh, are our opinions. But they're opinions.<br />
RAYMOND McDANIEL: Opinions, and those are, they are just opinions.<br />
STEPHEN JOYNT: I think we are emphasizing the fact that our ratings are, uh, uh, are<br />
opinions.