Wall street has become a hot topic for the last one month.It is now controlled by a handful of people who are lavishly paid to misguide and exploit general public and investor.Now,the million dollar question is,should SEC block the creation of “synthetic CDOs”? No,by doing so,it will kill the creativity of the wall street.
Goldman sachs and other wall street Investment Bank marketed mortgage-backed securities to investor knowing well that such securities would plung in value.Last week the SEC announced that it had charged goldman Sachs and one of its vice Presidents,Fabrice Tourre,for defrauding investor.The regulator had alleged that Goldman Sachs marketed a synthetic Collateralised debt obligation(CDO)whose value was based on the performance of Subprime security it did not disclose to investor the fact that Paulson and Company,a major hedge fund that had bet against CDO,influenced Goldman Sachs to include that CDO in investor’s portfolios.
So,the main problem is the irresponsible Investment Bank and hedge fund companies,not the CDOs.We have to stop this malpractices
The Usual Disclaimers Apply.
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