No. of Recommendations: 2

I would say recently there is more disparity. The previous ratings debacle plus recent events has created a messier looking ratings system. The ratings houses rate 1000's of companies, how are they suppose to keep up in an environment that is rapidly shifting? S&P is going to come up with their priority list, Moody's is going to come up with theirs and Fitch is going to come up with theirs. This alone is going to create some disparity. A bunch of companies that deserve a ratings shift are going to be missed as well.

Often the 3 majors have been pretty close to lock step. Some of this unity is based simply in the numbers, some of the unity was tied to, for lack of a better term, politics. The ratings agencies are paid by the firms, if one firm tends to be too conservative they will likely find their revenues diminishing.

The odd thing is that it may benefit us. When things were pretty uniform many folks, pros and a little investors alike, didn't dig very deep. Why would they? The 2 or 3 big house all seem to agree that Company XYZ is AA plus or minus a minor step.

One disparity that has been constant and that has been mispricing; some debt has been too expensive for the quality, some debt has been too cheap for the quality. If we are patient and diligent we can spot these traps and opportunities. It may be easier with all this messiness to spot the good and the bad.

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