Groundhog day

By Creature

Ahhh, the magic of AAA:

Morgan Stanley plans to repackage a downgraded collateralized debt obligation backed by leveraged loans into new securities with AAA ratings in the first transaction of its kind, said two people familiar with the sale.

Morgan Stanley is selling $87.1 million of securities that it expects to receive top AAA ratings and $42.9 million of notes graded Baa2, the second-lowest investment grade by Moody’s Investors Service, according to marketing documents obtained by Bloomberg News.

I don't blame Morgan Stanley for trying to resell their crap, I blame the rating agencies for allowing it. Crap, backed by crap, is still crap (no matter how many magical AAAs Moody's uses to try and cover the stench).