Ever hear of SAFE HARBOR and forward-looking statements?
This company is not going out of business, but the share price may drop into the mid teens to reflect the increased risk and liability associated with it. Moody's does not simply issue opinions, they are supposed to be substantiated and amount to a seal of approval.
While they may not be criminally liable, the burden in civil court is much lower. All you need is a preponderance of evidence to show that they were "baking" the bond ratings.
You tell me... how do you get a jury to buy that you were acting in good faith when you bundle BB paper and reissue it as AAA securities. Ratings agencies are supposed to be independent, but how can they be independent when they are dependent for business and revenues on the cos they are "independent" of.
It's time for big business to wake up and smell the coffee.
MCO will get through this, but they may have huge liability exposure and as such look extremely overvalued.
The ratings agencies deserve the same haircut the banks and insurers took -- they won't go that low, but they are going lower from here. That's probably why Warren Buffett is getting out of some shares. Obviously he suspects the risk is to the downside, or he would see this stock as undervalued and add to his position.
That points to a negative bias... Moody's ought to downgrade themselves.