Warren Buffett is sworn in before testifying to the Financial Crisis Inquiry Commission in New York on June 2, 2010.
Warren Buffett is getting a lot of negative reviews for his appearance under subpoena yesterday (Wednesday) before the Financial Crisis Inquiry Commission.
In response to respectful, but pointed, questioning, Buffett argued that Moody's shouldn't bear all the blame for giving favorable ratings to subprime mortgage loans that later went horribly bad, sparking the financial crisis we've all been living through these past few years.
Almost everyone, he said, believed at the time that housing prices couldn't crash. "Look at me. I was wrong on it too."
Buffett was there because his Berkshire Hathaway holding company is Moody's largest shareholder with a stake now, after months of selling, of about 13 percent, down from almost 20 percent a year ago.
After the hearing, panel Chairman Phil Angelides told Reuters,
Warren Buffett to Panel: Moody's Doesn't Deserve All the Blame for Bubble
Watch Buffett's testimony
Warren Buffett to CNBC: Market Demands 'Brand Name' Credit Rating Agencies
Read the CNBC interview transcript
Reuter's Felix Salmon writes that it was "arguably the single worst day of Buffett's life" from a PR standpoint.
Among other pans, Salmon cites Pragmatic Capitalism's criticism of Buffett's Moody's defense:
Bond Girl writes on Self-Evident that
On Capital Gains and Games, Edmund Andrews calls Buffett's performance "shameful," adding that "I never thought I would ever say this, but Warren Buffett has turned into an evasive, disingenuous, bumbling buffoon."
Money Watch's John Keefe writes his criticism under the headline,
Kevin Hall of McClatchy Newspapers focused on one aspect of Buffett's testimony, reporting his assertion that he wasn't tipped off to problems with bonds highly rated by Moody's is a "direct contradiction" of email evidence "presented privately to the panel."
On Fox Business, Charlie Gasparino accuses Buffett of "defending the most corrupt business model in corporate America" (the people issuing the debt pay for that debt to be rated, creating a conflict of interest) just because Moody's was a good investment.
CNBC.com Senior Editor John Carney wrote on this site that
Carney also highlights Buffett's statement to the Commission that he looks for misrated securities because "that will give us a chance to turn a profit if we disagree."