Question

Investigations into the financial rating industry after the financial meltdown of 2008 found all of the following except

a. analysts cut corners when faced with less time to perform due diligence.
b. analysts' ratings were inaccurate.
c. many high ratings were based on inadequate historical data.
d. analysts were overwhelmed with the volume and complexity of trades.
e. most analysts were completely untrained and unprepared to do their jobs.

Answer 1

The incorrect option regarding the post-2008 financial meltdown investigations is that most analysts were completely untrained and unprepared for their jobs. The correct option is e.

Step-by-step explanation:

Among the findings of the investigations into the financial rating industry after the financial meltdown of 2008, the option that was not discovered was e. most analysts were completely untrained and unprepared to do their jobs.

What was found included:

• Analysts cut corners when faced with less time to perform due diligence.
• Analysts' ratings were inaccurate.
• Many high ratings were based on inadequate historical data.
• Analysts were overwhelmed with the volume and complexity of trades.

These shortcomings contributed to the financial crisis, as did aggressive lending, risky behavior by investment firms, and lax government oversight. Mortgage-backed securities, often highly-rated erroneously by rating agencies, were core to the crisis.

Corporate governance failures and a lack of timely action from bank supervisors further aggravated the situation.The correct option is e.