In case anyone missed the reference in the previous post - and it's just too good to be missed - an SEC report from a few months ago revealed some interesting idiosyncracies about S&P's rating process. The following is a 2007 instant message conversation quoted in the report:
Official #1: Btw that deal is ridiculous.
Official #2: I know right...model def does not capture half the risk.
Official #1: We should not be rating it.
Official #2: We rate every deal. It could be structured by cows and we would rate it.