From the LA Times: S & P slashes State Street CDO rating.
The ratings on the most senior class of Carina CDO Ltd. were lowered to BB, two levels below investment grade, from AAA, while another AAA class was slashed 18 steps to CCC-minus. The chance of material losses to note holders is high, New York-based S&P said.
Eighteen notches, count 'em, eighteen.
It's as if you thought you were loaning money to the Swiss, and instead found that you'd bought bonds from Uruguay or Turkmenistan!
Hurray for the lawyers!
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