Bill Ackman Talks About Outlook For Credit Rating Agencies On Bloomberg TV

Bill Ackman of Pershing Square Capital Management LP, spoke to Bloomberg Television's Deirdre Bolton yesterday morning about the outlook for financial regulatory overhaul and credit-rating companies.

On rating agencies:

“What is happening with the ratings agencies now will make them better - all the litigation."

"I think they’re much more careful, if they have a point of view, to bring it public as quickly as possible. I actually think it would be a good thing for rating agencies if they suffered some consequences for bad opinions.”

“One of the problems is, when you have an institution who is allowed to write opinions that have enormous market impact, but they have no economic - they have an exemption for free speech, it can create some problems. Rating agencies, in my view, during the credit crisis acted effectively as underwriters. Deals could not get done without their primatur."

On financial regulation:

“I think the most important thing is that capitalism is allowed to work…You don’t want the government coming in and subsiding one class of creditors over another. I think it leads to moral hazard and other issues. And I think the concern during the credit crisis was could they actually let a bank--- after Lehman filed, and the consequences, they were afraid to let a financial institution go down."

“I like Sheila Bair’s resolution regime. I think it makes a lot of sense.”