5 CRITICAL "CHECKS AND BALANCES" FOR STOPPING THE CARNAGE ON WALL STREET: 1) Leverage rules have to be applied stringently 2) Structured investments vehicles* should not exist off the balance sheets Wherein, structured investment vehicles
not on the balance sheet create leverage 3) Haircuts should be attainable on all securities Haircuts are down payments on an investment just like the down payment consumers need for a home 4) The Up-tick rule has to be enforced on short sales The Up-tick rule prevents short sellers from adding to the downward momentum when the price of an asset is already experiencing sharp declines.
Structured investment vehicles
are funds that raise cash by issuing short-term debt and using the proceeds to buy higher-yielding assets such as US mortgage bonds.
This assessment follows the company's announcement today that it has entered into support agreements with eight of its cash funds that hold senior notes issued by troubled Structured Investment Vehicle
(SIV) Whistlejacket Capital LLC and its subsidiary White Pine Finance LLC (collectively referred to as WJ).
0 million impairment charge related to the purchase of senior securities in a structured investment vehicle
from Janus' money market funds.
White Pine is a structured investment vehicle
SG CIB sponsors and administers six asset backed commercial paper conduits and one Structured Investment Vehicle
("SIV") with aggregate USD 23 Billion of commercial paper outstanding as of 12/31/2003.
In addition, McGraw Hill reached a separate $125 million settlement with the California Public Employees' Retirement System to resolve its claims regarding ratings on three structured investment vehicles
In addition, the Company reached a separate settlement with the California Public Employees' Retirement System ("CalPERS") to resolve its claims against the Company regarding ratings on three structured investment vehicles
The shadow banking system consists mainly of hedge funds, structured investment vehicles
and the securitisation markets.
Such intermediaries, which include hedge funds, money market funds and structured investment vehicles
, provide credit to the financial sector, but, unlike banks, have no access to central bank support or safeguards such as deposit insurance and debt guarantees.
Tett deftly paints the picture of a perfect financial storm: Greenspan had slashed rates to almost nothing following the implosion of the tech bubble and was a staunch devotee of both free markets and derivatives; Americans were practically being gifted houses regardless of their credit worthiness; investment banks were doing a roaring business splicing up mortgages and selling them; ratings agencies such as Standard & amp; Poor's were stamping CDOs with AAA ratings and collecting fat fees; meanwhile, the massive pile of mortgages that were yet to be sold were funnelled into Structured Investment Vehicles
(SIVs) by banks anxious to keep debt off their books.
At BMI, we do not have any exposure to collateralised debt obligations (CDOs), structured investment vehicles
(SIVs) or other complex products.