In the latest twist, new low-grade securities that have no record "rent a rating," purchasing a guarantee for payment of principal and interest from a reputable insurance company. "Lacking time to do thorough analysis of the entire project, overworked credit analysts simply look to the quality of the guarantor and then, if the firm is respectable, issue an investment grade rating." Investors see the AAA rating and lose their shirts (Willoughby 1986).

XREF: Connects to financial market incentives and moral hazard literature on ratings agencies and their substitutes.

Shapiro, Susan P., The Social Control of Imper…, loc. 126