``We knew the delinquencies were bad,'' he says. ``The fact was, if we could have hired a supreme being to tell us exactly what the loss was on a loan, they wouldn't have hired him because the Street wasn't going to pay us extra money to know that.''
Incentives matter. So do ethics, particularly when the incentives are both strong and misguided. The article links to the SEC report on the ratings agencies, whose failures in this environment should not be forgotten.
Read the whole thing.