Brokers and the Credit Crisis
Here is a writeup on brokers and the credit crisis. The writer is famous John Hempton from Bronte Capital. The article is the last segment of a 3 part series.
Article Introduction (Via Bronte Capital)
My assertion is that the brokers – more than any other institution – have become the intermediaries between the Anglo/American (and Spanish) economies and copious pools of savings.
Article Excerpts (via Bronte Capital)
So investment banks worked out a trick – which was to wrap the BBB tranches up into “collateralised debt obligations”.
It’s the “storage business” that fascinates me. They call it “trading” which implies a “moving business” but trading as done by most investment banks involves considerable storage.
Click here for the Article on Brokers and Credit Crisis
**Below are the first two segments of the series
