CNBC was excellent. It made the point that the critical factor that allowed the explosion of derivatives was the ability to rig the market to get AAA ratings for all the derivatives, including the top (riskiest) “slice”. The AAA rating created a nearly-unlimited demand for the securities. Without AAA ratings there never would have been the demand that led to the expansion of all those exotic mortgages.
Kendall, I once tried emailing you about the This American Life episodes titled the Global Pool of Money. It’s pretty phenomenal and make the connections between homeowners, who should have never gotten houses, and those selling derivatives of various sorts. You’ll find them pretty easily.
Did the program make mention of the nefarious role the House and Senate committees lead by Rep. Frank and Sen. Dodd, respectively, played in forcing legislation through that required banks to head in the destructive direction we now founder in? This witches brew had many cooks, but Frank and Dodd never seem to get the full measure of the credit they have so richly earned.
CNBC was excellent. It made the point that the critical factor that allowed the explosion of derivatives was the ability to rig the market to get AAA ratings for all the derivatives, including the top (riskiest) “slice”. The AAA rating created a nearly-unlimited demand for the securities. Without AAA ratings there never would have been the demand that led to the expansion of all those exotic mortgages.
Kendall, I once tried emailing you about the This American Life episodes titled the Global Pool of Money. It’s pretty phenomenal and make the connections between homeowners, who should have never gotten houses, and those selling derivatives of various sorts. You’ll find them pretty easily.
Did the program make mention of the nefarious role the House and Senate committees lead by Rep. Frank and Sen. Dodd, respectively, played in forcing legislation through that required banks to head in the destructive direction we now founder in? This witches brew had many cooks, but Frank and Dodd never seem to get the full measure of the credit they have so richly earned.