Greg Boop

Why Wall St. Needed Credit Default Swaps

The description of how the banks book the next 10 years' profit today on CDO products by using credit default swaps is revealing. The implementation of these transactions are very reminiscent of how Enron used mark-to-market accounting to take profits immediately rather than over the period of a contract.

Excellent article.

Let's Get Real About Bear Stearns

It is interesting to note that the financial press has not touched on one of the more pertinent reasons why the executives at Bear Stearns decided to take the low bid offer rather than to enter reorganization. Under bankruptcy, the executives would most likely be required to pay back the millions in 2007 year-end bonuses that they recieved in the past 120 days.

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