With so many foreign banks buying into our mortgage derivative
schemes, no other outcome was possible.
The process of unwinding subprime mortgage derivative
swaps and other commercial derivative swaps hasn t materially improved over the last three months but is now being overlooked by investors as the banks are simply not talking about them," Dickson said.
In one form or another, the AIG and mortgage derivative
cases share characteristics that result in similar outcomes: Notwithstanding a great many records in many places, the result was not the clarity and certainty those records were supposed to ensure, but opacity, confusion, and staggeringly large financial losses.
Imagine if we had allowed the mortgage derivative
markets to do the same thing.
The first effort involves an interagency statement issued in February of this year on the proper use by banks of so-called "high risk" derivative instruments-- investments such as interest- or principal-only mortgage derivative
Last year, Goldman paid USD550m to settle fraud charges from the Securities and Exchange Commission, relating to a particular mortgage derivative
, the report said, adding that the US Justice Department is also investigating the bank.
A third major mortgage derivative
blowup hit an $827 million mutual fund run by Piper Capital Management, a subsidiary of Piper-Jafray Companies Inc.
12 May 2010 - US Morgan Stanley's (NYSE:MS) CEO James Gorman said today he was not aware that the firm was under scrutiny by local federal authorities in relation to mortgage derivative
deals, as reported by the Wall Street Journal.
A high-risk mortgage security is defined as any mortgage derivative
product that has (1) an expected weighted-average life greater than eight years (i.
He started his financial career at a mortgage derivative
hedge fund in the late nineties where he built term-structure and option-pricing models for mortgage related products.
With Lehman Brothers and Bear Stearns evaporating overnight, and many of the world's top investment banks still reeling from the mortgage derivative
debacle, finance--the holy grail of MBA students--has virtually vanished as a career option.
Outside of a few notable companies, property/casualty insurers were modestly affected by problems in subprime mortgage and mortgage derivative
markets, but recent events that promoted sharper declines in equity markets and a flight to the safety of treasury securities from high-rated corporate and tax-exempt bonds has had a more severe effect on insurers' invested assets and capital position.