Acronyms to Ponder

Until last week, I'd never heard of "IBGYBG." But during the Senate Permanent Subcommittee on Investigations' eye-opening hearings into ratings agency malfeasance, former Moody's senior credit officer Richard Michalek introduced me to it while testifying about the perverse incentives that dominated the industry. On the investment bank side, he said, bankers were looking to score the one-time fee from whatever securitization deal they were asking the agency to rate, and move on to the next deal. The incentives for the bank, Michalek said in prepared testimony, were clear: "get the deal closed, and if there's a problem later on, it was just another case of IBGYBG--I'll be gone, you'll be gone."

Michalek says he first heard the phrase from "an investment banker who was running out of patience" with his "insistence on a detailed review of the documentation."(The Nation)

Clever.