I now declare everything about my life a ‘AAA’ rating and I think you should too. The rating appears to be easy to come by, so why not just proclaim our ‘AAA’ grade on stock picks, family life, finances, the golf game and our credit score. If these bond insurers can get this kind of rating for junk then everyone should.
Oh how easy school would have been way back in the day if just showing up meant you got an ‘A’, but not just an ‘A’ a triple ‘A’. I could have scored a scholarship to any school I wanted and not put a dime down for the education. This of course would have lead to a pick of any job I wanted coming out of college instead of going through the pain staking task of looking for one. The next logical step is making big cash beyond my wildest dreams. This money does not lead to happiness but since my happiness rating is a triple ‘A’ I have nothing to worry about. I also have just been declared father and husband of the year by the wife and kids. Please don’t ask them for a rating, trust me I am a triple ‘A’.
Now to most of us investors this rating system did not mean very much, at least until the last 6 months, because most of us didn't know any of these bond insurers. It does make you wonder how accurate their rating systems are. The people rating these are smart, right? It kind of reminds me of the rating system on stocks before the tech bubble burst back in 2000. The majority of ratings on stocks never moved off the 'strong buy' or 'buy' list as the stocks bottomed out and in some cases went to zero. These stock ratings are supposed to be more accurate in telling us of how a company feels about a stock, but I'm still a little skeptical. In fact, I would never use analysts’ ratings when deciding on a stock. Use your own research and homework as your rating system and I think you will find you are a lot better at picking stocks.