Standard & Poor's "Research"

S&P is supposed to objectively rate the safety of financial products. However, the Justice Department claims that the firm inflated the ratings of mortgage investments in order to make them appear safer than they really were, thereby contributing to the financial crisis of 2008. Ratings agencies are paid by the very institutions whose products they rate. What is the significance of this conflict of interest? See Focus on Research (http://focusonresearch.wordpress.com/2013/03/13/standard-poors-research/) for some discussion.