As the search for culprits behind the meltdown continues, ratings agencies have found themselves in the gun. Executives from Moody's and Standard & Poor's have told Congress that the problem was caused by conflicts of interest. More from the New York Times.

"Profits were running the show," said Frank L Raiter who headed mortgage ratings at Standard&Poor's.

In other words, a business model where securities issuers paid the agencies to issue ratings created inevitable conflicts. The question is why nobody had picked that up before.

It's a point picked up by Dean Baker, the co-director of the Center for Economic and Policy Research. "It is remarkable that this has never become much of an issue before. The agencies want to get hired, and they're well aware of the fact that if they're not giving acceptable ratings, they may not be called back," he told Mother Jones.

Jim Landers at the Dallas Morning News also sheds some insights into the way they worked. The ratings agencies would give financial engineers copies of their tests, let them take it several times until they got the AAA standard, and then did a separate, and as it turned out, optimistic, assessment of their risk.