It is now clear that for years we have been putting our money where our mouth isn't.Non-recourse, off-balance sheet finance, a.k.a. securitization/structured finance, is about the value of a pool of loans where the risks are redistributed inside a structure. What are the loans worth?...
I am reminded of the first paragraph in the CFA manual under the header, Ethics in the Investment Profession—Ethical practices by investment professionals benefit all market participants and stakeholders, and lead to increased investor confidence in global capital markets. Clients are reassured that the investment...
There are markets, and there is the Market. Markets are networks of people who come together to exchange one thing for another. The Market is the cornerstone of a belief system whose biggest proponent has been the University of Chicago. Chicago: Hog Butcher for the...
In Rope-A-Dope 101, we said there are five ways to mask the credit quality of a structured bond, that it is done by manipulating an “invisible” boundary where the consequences of being on one side or the other are not symmetrical, and that the boundary...
The high road of securitization is forward-looking. It promotes economic growth and rewards superior asset quality. Securitization is alive and doing well in grass-roots economies. But maybe you have not come to our blog to read about the high road of securitization. Maybe you have...
In early 2004, we were asked to join a professional support team to help a new equipment lessor get financing through the structured market. The premise of the deal, the team, and our role in it, were not new. The endgame, to get a monoline...
So, structured ratings are not good indicators of secondary market value, and market prices are not working their usual magic. Why are we surprised? More importantly, how do we want the sector-wide securitization crisis of confidence to turn out? Do we secretly desire a return...