> Look, I know these S&P guys. Not these particular guys — I don’t know
> John Chambers or David Beers personally. But I know the rating
> agencies intimately. Back when I was an in-house lawyer for an
> investment bank, I had extensive interactions with all three rating
> agencies. We needed to get a lot of deals rated, and I was almost
> always involved in that process in the deals I worked on. To say that
> S&P analysts aren’t the sharpest tools in the drawer is a massive
> understatement.
>
> Naturally, before meeting with a rating agency, we would plan out our
> arguments — you want to make sure you’re making your strongest
> arguments, that everyone is on the same page about the deal’s positive
> attributes, etc. With S&P, it got to the point where we were
> constantly saying, “that’s a good point, but is S&P smart enough to
> understand that argument?” I kid you not, that was a hard-constraint
> in our game-plan. With Moody’s and Fitch, we at least were able to
> assume that the analysts on our deals would have a minimum level of
> financial competence.
>
> I’ve seen S&P make far more basic mistakes than the one they made in
> miscalculating the US’s debt-to-GDP ratio. I’ve seen an S&P managing
> director who didn’t know the order of operations, and when we pointed
> it out to him, stopped taking our calls. Despite impressive-sounding
> titles, these guys personify “amateur hour.” (And my opinion of S&P
> isn’t just based on a few deals; it’s based on countless deals,
> meetings, and phone calls over 20 years. It’s also the opinion of
> practically everyone else who deals with the rating agencies on a
> semi-regular basis.)
>
> [...]
>
> So to S&P, I say: you should be ashamed of yourselves, and I truly
> hope this is your downfall.