Standard & Poors, aka “S&P” is one of a handful of players in the bond and securities rating space that have been in the news lately concerning inherent conflict of interest.

Let’s see if I got this right, the entity’s that want to sell securities pay S&P a fee to rate the risk of these securities. If S&P rates them as stinkers, the securities get a junk rating and make them harder to sell. What do you think S&P is going to do (keeping in mind the feeding hand)?

S&P is a part of much larger McGraw-Hill, publishers of Business Week among other things. Could we really be cynical and  say Business Week isn’t going to slam the very clients who are paying S&P?

What do you think…

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