Senate Banking Committee Holds Hearing on Rating Firms

At a Senate Banking Committee hearing on the role of the rating firms in the subprime mortgage market collapse, SEC Chair Cox said that the SEC had opened an investigation into whether the credit-rating firms inflated their ratings of mortgage-backed bonds because they were also advising the investment banks on packaging the securities.  Representatives from S&P and Moody's denied that conflicts of interest played any role in inflating ratings.  The hearings continue for a second day.  NYTimes, S.E.C. Inquiry Looks for Conflicts in Credit Rating.