Monday, March 20, 2017

How many YYYs at XXX believe the below BB- rated more dangerous to a bank system than the AAA rated?

I ask because the bank regulators in the Basel Committee clearly do believe that.

In 2004, with Basel II they assigned a 150% risk weight to what is rated below BB-, something to which banks would never ever create dangerous exposures to; and a meager 20% to what is AAA rated, something which, if wrong ex-post, is precisely the stuff bank crises are made of.

And I am a bit concerned seeing that no one is out questioning the regulators about this.

I have tried to ask them questions, but I am not a University, an important media or a sufficiently important personality

Would they answer me if I were ZZZ?