Buffet’s Financial Folly

May 11, 2010

Another one of Warren’s much hearladed, best in breed financial companies (to the extent you can call a ratings agency a ‘financial’) is in deep deep trouble.  Just like Salomon in the 80’s and Goldman last week, it doesn’t take much for these financial stars to fall from Grace.

Amongst other problems at the company – like rating 90% of defaulting CDOs as AAA – it now appears that Moody’s CEO entered a big automatic stock sale order just 1 month before of the SEC served the company with what is known as a “Wells Notice”.  This notice might lead to the firm loosing its license which would send the shares crashing to ~0.  Unlikely to happen but selling your shares around this time is mighty suspicious.

Shares are currently @ $21.97 and have been falling hard since the news hit on Monday May 10 (having closed $23.36 the preceding friday)

Check out the full story here: http://bit.ly/dB9q2v

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