Posts belonging to Category Asset Backed Securities

The 2007-2008 Financial Crisis was not a ‘Black Swan’ Event


Many commentators have noted recently that the Wall Street meltdown of 2007-2008 was not a “black swan” ? that is, an unprecedented and therefore unpredictable occurrence. Named for an influential 2007 book titled The Black Swan by investment fund manager Nassim Nicholas Talib, the black swan was used as a metaphor to explain why humans […]

Judge Challenges ‘Cozy’ Deal Between the SEC and Citigroup


U.S. District Court Judge Jed S. Rakoff has been asked by the SEC and Citigroup to approve a settlement of charges that Citigroup misled investors in a $1 billion dollar CDO deal called Class Funding III that was tied to residential mortgage-backed securities. Citigroup would pay a $95 million penalty and not admit fault. The […]

Is the SEC Selectively Enforcing the Securities Laws?


Reuters blogger Felix Salmon seems to see evidence of the SEC colluding with banks to let them off the hook for most of their “built to fail” synthetic (derivatives-based) CDOs (see “Is the SEC colluding with banks on CDO prosecutions?”). What has raised eyebrows was an email from a Citigroup spokesperson saying that Citigroup has […]

Alternative Investments – High Risk ‘Pigs in a Poke’


Many investors in alternative investments are in for unpleasant surprises. Alternative investments are very popular these days, as traditional stock and bond investments are not doing well. Alternative Investments include a wide variety of investments that fall outside the traditional stock and bond categories. Examples include structured products (such as principal protected notes and reverse […]

And Now For Something Completely Different


To demonstrate that this blog is not just full of thoughts put to words, we offer the following link to an entertaining and thought provoking music video that proves that disappointment in, and anger against, Wall Street events over the last few years is not limited to this country. Please welcome the acclaimed English acoustic […]

The Housing Markets Aren’t Bouncing Back


Prices and sales in the housing market appear to be grim through 2015 according to economists, builders and others in the industry. The biggest drop already occurred in 2008. Ancillary industries such as landscaping, mortgage lending, and home improvement feel the loss as well.

Whistleblower Problems Add to Bank of America’s Woes


A Bank of America employee will collect $930,000 from his former employer, Bank of America, for being fired in violation of the whistleblower protections. The employee blew the whistle on fraud at Countrywide Financial Corp. and led internal investigations that found “pervasive wire, mail and bank fraud involving Countrywide employees,” according to the U.S. Department […]

Do Hedge Funds Create and Burst Bubbles for their Own Benefit?


In recent years, hedge funds have become dominant players in the investment markets and the evidence suggests that hedge fund trading (which regularly involves thousands, if not hundreds of thousands, of shares) has been a significant contributing factor to market volatility.

Time Is Running Out On Credit Crisis Legal Claims


Many investors, both individuals and corporations, were misled by their brokers and harmed during the credit crisis. For various reasons, however, many such investors have not yet taken action to recover their losses. Some have delayed taking action in order to see whether the misconduct warranted legal action while others just put it off until […]

SEC Expands Investigations into Toxic CDO Deals as the Awful Truth Begins to Come Out


The SEC is expanding its investigation into Wall Street’s sales practices involving toxic collateralized debt obligations that were linked to subprime mortgages as more and more evidence comes out that the Wall Street banks deliberately defrauded some of their customers.