Subject: File No. S7-18-11
From: Dave Cowen
Affiliation: Mortgage Broker

May 23, 2011

I have been shocked at the total lack of responsibility or regret from the credit rating agencies and their complete failure in rating Mortgage Backed Securities. Much of the US doesn't understand that the real estate crash and corresponding stock market crash was really a result of a much more serious bond market catastrophe. The bond market, many times larger than any other (except currencies), drove everything else down. A major part of the problem was the sheer number of derivatives with little underlying assets. But even more of an issue was that the underlying assets were not only rated incorrectly... it was (and is) industry practice to rate them incorrectly. Credit rating agencies were taking mortgage-backed securities that had been chopped and repackaged so many times that they were effectively junk bonds and rating them as AAA. Those that didn't lost their business to other credit rating agencies that did. This credit rating is the basis of transparency and accountability in the bond market. And yet, when it became public knowledge that these rating agencies had become a rubber stamp to anyone that paid them we, as people and as a government, did nothing to correc the situation. Instead, the rating agencies have been protected every step of the way and not been held accountable. This is disgraceful, and I implore the SEC to step in and take the steps necessary to bring justice to the American people and to keep this kind of thing from every happening again