"There may be another wave of credit-rating downgrades of subprime-mortgage securities. [S&P] yesterday sharply raised its projected losses for subprime mortgages made in 2006 to 19% from 14%, as loan deliquencies are rising", WSJ, 16 January 2008.
What do the rating agencies do? MBIA sells 14% debt rated AA, while MBIA's stock is rated AAA. What madness. AA corporate debt yields less than half of 14%.