2 ms·
Prior default doesn't factor into default risk? There is something really wrong with rating agencies. I think you've convinced me more of my view rather than sw
by onethought 4y ago
Prior default doesn't factor into default risk? There is something really wrong with rating agencies. I think you've convinced me more of my view rather than sway me. The credit scores are completely meaningless.
- s1artibartfast 4y agoWhy would it? it isnt a question of character. It is just assets and profit vs Debt. The same is true for individuals too. If you have enough collateral, no one gives a shit if you went bankrupt in the past.
- onethought 4y agoIt’s a question of governance. If they couldn’t manage it before… why can they now? GM has a debt ratio of 1.7 compared with Tesla (the high growth new comer) of 0.9. You put ANY metric between Tesla and GM that could justify GM having a higher credit rating. It’s ridiculous.
- nradov 4y agoYou seem to be deeply ignorant of basic finance. Have you ever actually read a bond rating from one of the big rating agencies? They explain the metrics they use. If you think you have found an error in bond rating procedures then put your money where your mouth is. Go long Tesla bonds and short GM bonds, and make a fortune. Be sure to lever up to maximize your returns.
- onethought 4y agoSo which metric causes Tesla to be rated lower than GM? Easy to call someone ignorant, but how about you show it.