[gregdale]

It's a very finance culture approach, though, where the bounds of what's in and out are tested constantly by what (knowledgeable, ideally) participants, compliance departments, and regulators are willing to tolerate. Many banks were highly criticized after the financial crisis for selling "knowingly toxic" CDO/CLOs but on the other side of the trade were highly sophisticated buyers who wanted those securities.

[pydry]

They hacked the ratings system. There were pension funds who saw AAA rated garbage with apparently high returns and thought "woohoo!"

Theres a really book called traders, guns and money that goes into the details on this.

When the government started going after the ratings companies they downgraded US bonds (as if the US would ever default...)