The Son of Finance of the Great Age

  Chapter 782 Moody Hearings

   "Mr. Al..."

  Lisa was anxious, and chased Al Fran to the door, but after the other party gave her a cold look, she had to swallow the words that came to her lips, and let the other party walk away.

  A member of Congress is definitely not someone like Lisa who can afford to offend.

   "Hey, I don't even have a chance to talk!"

  Dairio laughed at himself, and complained to Zhong Shi, "What the **** is he, how dare he make such a big deal!"

   As he spoke, he clenched his hands tightly, his fists trembling slightly, and his joints turned white. It was obvious that Delio was extremely angry.

It is true that, with a status like Delio, he is an absolute guest wherever he goes. Even Delio can talk and laugh in front of the governor and vice president, but today he was rejected in front of a congressman. Naturally, Delio felt a deep humiliation.

   "Relax, my friend!"

  Zhong Shi was not as angry as Delio. Although he was also quite surprised, although he had expected that the trip would be quite unsatisfactory, the indifference of the other party was far beyond his expectation. But even so, Zhong Shi didn't think it was possible for the whole matter to go on.

   "Since this is the case, then we should take a trip to Minnesota, have a field trip, and see the situation there."

   Zhong Shi sighed in his heart while comforting Delio. It seems that this time, if the congressman changes his original intention, he will have to pay a high price.

  Seeing Zhong Shi and his group, the three people consulted by Bellan looked at each other, all feeling puzzled, not sure what Zhong Shi said.

  But they were quickly shocked by Zhong Shi's generosity.

  …

   "The next witness is the former U.S. Secretary of the Treasury, Mr. Henry Paulson."

  At the congressional hearing two weeks later, Al Fran, who was sitting in the middle seat, as the chairman of the investigative committee, was speaking forcefully to everyone.

  This time, it is a congressional hearing jointly held by the U.S. Congress, the Department of Justice, the SEC, and some state governments. It is intended to investigate the role played by rating agencies in the financial crisis and prepare for further charges and investigations.

  The hearing hall, which can accommodate hundreds of people, poured in two or three hundred people, most of whom were media. Chasing the trend of Wall Street has always been what the media are most willing to do, and this time the behavior against the top rating agency in the financial chain has attracted the attention of most media.

  The hearing committee has a total of seven members, five of whom are members of Congress, one is a representative of the SEC, and the other is a prosecutor from New York State. They sat on high seats at the very front, in a row opposite them reserved for witnesses being questioned.

   Around them, some seats are reserved for the audience and reporters.

   It should be noted that the Congressional hearing is not a legal trial, but a special meeting to explain the situation to members of Congress. That is to say, members of Congress have the right to call relevant personnel for a hearing if they do not understand something or are confused about the situation. Simply put, this kind of hearing is a meeting to explain what the country and the government have done.

  Under the overwhelming spotlight, Henry Paulson appeared accompanied by lawyers. In his own seat, he pressed the "Bible" in his hand to swear, and then sat down cautiously.

  After the new president came to power, Henry Paulson was no longer the Secretary of the Treasury of the United States. His position was replaced by Ben Geithner, the former Vice Chairman of the Federal Reserve and President of the Federal Reserve Bank of New York.

  However, as the former finance minister who turned the tide during the crisis, he still needs to testify for many details of the crisis, which is why he is required to attend the congressional hearing today.

   "Mr. Paulson, tell us about the impact and role of rating agencies during the financial crisis?"

As soon as Henry Paulson sat down, Al Furlan couldn't wait to ask, "During the subprime mortgage crisis three years ago, with the collapse of a large number of home mortgages, did Moody's, S&P, and Fitch What kind of role did the rating agencies represented by China play in it?"

  Because it is related to themselves, S&P, Moody’s and Fitch also sent people to participate in the Congressional hearing. At this time, they are sitting with Zhongshi, Delio and others, watching everything on the stage intently.

   "Yes, Mr. Chairman!"

Paulson first discussed with his lawyer in a low voice for a long time, and then he replied respectfully, "During the subprime mortgage crisis, many bonds that were originally rated as AAA became junk overnight. The sudden downturn in credit caused a collapse in prices, which spread everywhere, to the extent that I had to use huge sums of money to save the entire financial market."

   “So what do you think is the rationale for the rating agencies to downgrade these bonds?”

  Al Fran felt as if he had found a treasure, and continued to ask, "According to your experience and judgment, do you think they did it on purpose, or did objective facts lead to this behavior?"

He set a trap for the other party here. If you answer the former, it will confirm the fact that the rating agency is manipulating it, and if you answer the latter, it means that these bonds are originally at the junk level. Under the "care" of the rating agency After all, all this happened too fast, and there is only such a reasonable explanation.

  Although he set a trap, how could Paulson be easily fooled? He replied indifferently: "I don't understand the rating methods and models of rating agencies, so I don't know what's going on. What I just admit is that during the subprime mortgage crisis, rating agencies It has indeed played a considerable negative role.”

  It was just an understatement, and it sent the other party away.

  Al Fran was naturally quite disappointed, but he quickly got rid of this frustration and continued to ask: "You mean that rating agencies are also one of the culprits of this financial crisis?"

   "I don't know the culprit. Responsibility is diverse, and some human greed is also included."

  Henry Paulson remained unmoved, and then evaded, "But I can be sure that the rating agencies are also one of the reasons for the formation of this financial crisis. This is beyond doubt."

  Twice in a row, Al Fran failed to get the answer he wanted from Paulson, which made him realize that it was impossible for the other party to say the result he wanted. Then he asked a few more hasty questions and asked Paulson to back off first.

   "They're out of luck this time!"

  The people on Moody's side smiled, and whispered to Zhong Shi beside him, "This guy is going to be at the end of his rope!"

  The person who came from Moody's side this time was Dean Bendtner, the managing director of the public relations department of Moody's Company, a middle-aged white man in his forties, with short brown hair and a complete public relations expert.

   "It's too early to tell!"

Zhong Shi still stared at the stage, and explained in a low voice, "Since it has gone through such a long investigation, they will definitely not be such a few witnesses, and there will definitely be other people who will testify on the stage later. Before the last moment, all Don't let your guard down."

"yes?"

  Although Dean Bendtner said this in his mouth, he didn't take Zhong Shi's statement seriously in his heart. However, when he heard the name of the witness, his face changed instantly.

   "The next witness, Mr. Eric Krsinski!"

   Al Fran said expressionlessly.

"What's wrong?"

  After hearing Eric Krsinski's name, Zhong Shi keenly realized that Dean Bendtner beside him was fidgeting, and couldn't help asking, "Who is this person?"

   "A former colleague!"

  Dean Bendtner forced a smile and said to Zhongshi pretending to be calm. After saying this, he also realized that he was wrong, so he simply kept silent and said nothing more.

  Looking at the other party's reaction, Zhong Shi nodded thoughtfully, then withdrew his gaze and continued to look at the stage.

Eric Krsinski is a middle-aged man in his thirties. His face is pale and his manner is reserved. Perhaps it is because he is on such an occasion for the first time, so he is a little nervous, and he keeps wiping the sweat from his forehead .

   After swearing that the procedure was over, Al Fran glanced at Zhongshi seemingly unintentionally or on purpose, then cleared his throat, and asked loudly, "May I ask the name of the witness?"

   "Eric Krsinski!"

  Eric Krsinski hurriedly replied, and then added on his own initiative, "I'm a descendant of Polish immigrants, so my name is a little... strange."

   "I heard that the witness used to work for Moody's, the rating agency, didn't you?"

  Al Fran asked immediately, "Can you describe your working hours and responsibilities there?"

"Yes Yes Yes!"

Eric Krsinski nodded, "I joined Moody's in 2006 as the head of the subprime mortgage-backed derivative bond rating department. I left in 2010 and worked for a total of four years. "

   "So you're pretty familiar with Moody's internal methodology for rating subprime mortgage bonds?"

Kinsinski's words caused a commotion in the auditorium, so that Al Fran had no choice but to use his gavel, and after striking several times to warn everyone, he continued to ask, "Or, what about the accident that happened in your department?" Do you know how to rate, under what circumstances, the downgrade, and what impact will it have on the derivative bonds of low-grade loans?"

   "Yes, Sir!"

  Kersinski rubbed his hands, still speaking cautiously.

   "Then tell me, or tell everyone, during the financial crisis, did rating agencies or Moody's, in the process of rating these bonds, have any acts that were obviously illegal or unprofessional?"

   "This is not only the fault of Moody's, but also the fault of the entire rating agency!"

   Gradually, Eric Krsinski relaxed, and began to explain fluently into the microphone, "In my opinion, this is not only the fault of Moody's, but also the fault of the entire rating agency!"

   This sentence shocked everyone present.

  Al Fran's face showed joy, he thought he finally got what he wanted.

   "What the **** is this guy doing?"

  Looking at Dean Bendtner, who was looking increasingly ugly beside him, Zhong Shi couldn't help frowning and said, "Also, what's going on with him?"

   "A cynical guy!"

  Dean Bendtner thought for a while, and finally used such a word to describe the other party, "You also know that in order to compete with S&P and Fitch for the market, we need to compete for market share."

   "And he..."

Pointing at Eric Krsinski, Dean Bendtner said disdainfully, "He is an established guy who would rather stick to a more conservative rating agency, thus losing market share, and would rather not give credit to rating agencies. method to improve. That’s why he was fired.”

"so…"

  Zhong Shi stroked his chin, looked at Eric Krsinski who was talking on the stage, and said thoughtfully, "Shouldn't you say anything harmful?"

"Do not!"

Dean Bendtner categorically denied, "He will not only say things that harm Moody's, but also harm S&P and Fitch. Because his goal is not against Moody's, but the entire rating system. "

   Thanks to book friends Oliver Zhuangzhu, cpower, Dream Come True 7882 for voting monthly! Thanks to the book friends Three-legged Fork, Nanquan 99, and Electromagnetic Master for their rewards! I am very grateful to all the book friends for supporting this book at the moment of leaving the old and welcoming the new. Seeing everyone's support, the author has the motivation to work hard and hope to get through this difficult time smoothly. Of course, the author will try his best to persevere , thank you all~

  (end of this chapter)