Why was it a fallacy to assign a aaa ratings to these


Question

Up to the years preceding the financial crisis of 2008, many investors acquired bonds backed by pools of sub-prime mortgages that carried investment grade ratings including ‘AAA' because the investors believed that these securities would never default or be downgraded.

Why was it a fallacy to assign a ‘AAA' ratings to these securities backed by these mortgages?

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Financial Management: Why was it a fallacy to assign a aaa ratings to these
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