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How Wall St Shafted Main Street

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So just to summarise: back when the investment banks were buying up mortgage books to create their CDOs they hired a due diligence company to check the mortgages were good. The company told them that 29% were below par so the investment banks put a few weasel words in the prospectus to cover themselves and sold the CDOs.

But then they thought, actually we've just sold crap. Let's short our own CDOs 'cos they are bound to go down in value.

In investment banking it's heads I win, tails you lose! ;)

Edited by Nationalist

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So just to summarise: back when the investment banks were buying up mortgage books to create their CDOs they hired a due diligence company to check the mortgages were good. The company told them that 29% were below par so the investment banks put a few weasel words in the prospectus to cover themselves and sold the CDOs.

But then they thought, actually we've just sold crap. Let's short our own CDOs 'cos they are bound to go down in value.

In investment banking it's heads I win, tails you lose! ;)

Im pretty sure, a few words in a contract voiding what you already knew, and try to pass off as a complete surprise, is actually a fraud.

and acting on that info to your trading advantage is insider trading...also a felony.

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  • 244 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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