So wrong. S's old employer invented securities lending. They are real innovators. Also, because of lax oversight you can actually lend the same security to more than one person at a time, multiplying the fees, but also ensuring that the risk is multiplied, since it is exactly the same security.
Also, I think the real crux of the matter is why would a pension fund enter into such a poorly structured deal? On NPR the other day I heard someone talking about "regulatory capture". They were saying that it is actually much worse than the Chicago guys predicted because we essentially had society" capture, were someone overseeing a pension fund, supposedly the most modest, secure type of fund sincerely believed that this type of deal made sense becaseu a large bank was telling them it was a good idea. It isn't just the clowns at the SEC and Alan Greenspan who are taking the banks at their wor, tit is the man on the steet who didn;t realize how absurd it is to let a bank tell you what makes sensse
So wrong. S's old employer invented securities lending. They are real innovators. Also, because of lax oversight you can actually lend the same security to more than one person at a time, multiplying the fees, but also ensuring that the risk is multiplied, since it is exactly the same security.
ReplyDeleteAlso, I think the real crux of the matter is why would a pension fund enter into such a poorly structured deal? On NPR the other day I heard someone talking about "regulatory capture". They were saying that it is actually much worse than the Chicago guys predicted because we essentially had society" capture, were someone overseeing a pension fund, supposedly the most modest, secure type of fund sincerely believed that this type of deal made sense becaseu a large bank was telling them it was a good idea. It isn't just the clowns at the SEC and Alan Greenspan who are taking the banks at their wor, tit is the man on the steet who didn;t realize how absurd it is to let a bank tell you what makes sensse