It may seem like a completely different line of work, but former Dean of the College Nancy Malkiel says her new job isn’t as different from her position at Princeton as many would expect. Instead, in an exclusive interview, she has told the Tiger that her new role as chief analyst at Standard & Poor’s was a relatively comfortable transition.
“Coming into the job, I knew what I had to do,” she said. “The situation was out of control when I got here. It was just too easy to get a good grade! Here at S&P, we were handing out those AAAs left and right.”
This lax grading policy was considered one of the major causes of the economic crisis, and it became an immediate target for Malkiel. Since arriving in July, Malkiel has had an immediate impact, installing a new philosophy of more rigorous evaluations of groups in the hope of decreasing the number of AAA ratings given out by S&P. Already, the new policy has claimed its first victims, none other than the United States government and lenders Fannie Mae and Freddie Mac. Said Malkiel about the downgrade, “I wanted to just give them all B’s, but apparently that was too harsh.” When asked about the several trillion dollar error in S&P’s initial analysis, Malkiel muttered something about “adjusting for the curve” and quickly changed the subject.
We concluded our interview with Malkiel by asking her if anything about the reception to her new plan had surprised her. Though she dismissed concerns about the rapidly falling stock market- “once they understand what we’re doing, it shouldn’t affect the country’s chances”- she did admit she had expected other major credit groups like Moody’s to follow suit. “But none of them did,” she said, “so now we just look obnoxious.”