ETech: I Just Don't Trust You: How the Tech Community Can Reinvent Risk Ratings

My favorite conference of the year, ETech kicked off its general sessions today and its looking as stimulating as ever! While the topics covered by the conference have become less hard-core geeky, they have become more green and more broad. Sustainable topics, the environment and becoming better global citizens are just a few of the topics that have been struck this morning. ETech continues to make me think, which is the primary reason I keep coming back for more.

The first session I'd like to share with you was Toby Segaran and Jesper Anderson's "I Just Don't Trust You: How the Tech Community Can Reinvent Risk Ratings" presentation. Toby and Jesper posited that the system for rating credit instruments is horribly broken. Right before Lehman Brothers crashed, Moody's credit rating agency gave Lehman Brothers a AAA A2 credit rating. Moodys immediately down-rated Lehman Brothers after they crashed -- a little too late! Jesper and Toby outlined four reasons why the current system fails to do its job:

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