In sending a message to S & P as well as Wall Street more
generally regarding the excesses in the securitization of subprime mortgages
that contributed materially to the financial crisis of 2008, the U.S.
Government and several state governments announced in early 2013 that they
would sue S & P for $5 billion as a penalty and to cover damages to state
pension funds and federally-insured banks and credit unions. The operative assumption was that such a
monetary figure would have considerable force as a disincentive to profit by
means of fraud. Would $5 billion be
sufficient for the message to be delivered not only S. & P. but also to
Wall Street?
The full essay is at Essays on the Financial Crisis, and
Institutional Conflicts of Interest, both available at Amazon.