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Law Professor Discusses Bailout Package

Discussion in 'Economics and Financials' started by jdang307, Oct 9, 2008.

  1. jdang307

    jdang307 Season Ticket Holder Club Member

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    News

    this is actually my law professor in law school that got me interested in securities/corporate finance. He gained some notoriety by exposing derivatives trading in a book, insights on Enron (with congressional testimony) and accurately predicted, on September 12, 2001 in our class, that if he were the terrorist in charge of finances, he would have shorted Airline stocks and not insurance stocks, but Re-Insurance stocks. Supposedly he called some people at the SEC, and a few days later, those assets were frozen.

    Anyway, he's made a name analyzing these financial fiascos.
     
    dolfan06, DevilFin13 and finswin56 like this.
  2. finswin56

    finswin56 Get a mop

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    Awesome! Thanks for the link. I'll enjoy this tomorrow after I've had some sleep :lol:
     
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  3. jdang307

    jdang307 Season Ticket Holder Club Member

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    Lol, there's a great interview later in the clip, where they question a Trade Association CEO. It's hillarious.

    It explains a lot. I didn't understand how just the mortgages were bringing down the financial system. I mean, 5% of existing mortgages didn't sound bad.

    But Prof. Partnoy said, if it was just the underlying mortgages, there would be no crisis. It was the "sidebets", the credit default swaps, that is the center. Did not know that.
     
  4. DevilFin13

    DevilFin13 Season Ticket Holder Club Member

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    Wow. I don't even know where to start. Thanks for the info though. Hard to believe it started because of that 5-6% of mortgages.
     
  5. jdang307

    jdang307 Season Ticket Holder Club Member

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    Leverage is a B I T ... you know the rest.

    Check out my greenspan thread. See what happens when derivatives are allowed to grow unchecked. 1 bad investment is 1 bad investment. When you're allowed to produce deriviates of that bad investment, well start multiplying ...

    It's pretty crazy.
     
  6. dolfan06

    dolfan06 New Member

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    man, i watched all that video and common sense is the only thing that keeps me from going postal on these damn suits.
     

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