Wednesday, November 9, 2011

Arthur Bruzzone: Wall Street Cynicism Is What Has 'Trickled Down'

Arthur Bruzzone: Wall Street Cynicism Is What Has 'Trickled Down': "I read the first article about a poll in which over 50 percent of generally conservative financial planners supported the basic core protest of the Occupy WS movement.

But here's where it got interesting. Another article had this headline. "Best Short EVER! Ends up Costing Citicorp $285M."

It told how Citicorp, Inc. agreed to pay $285 million for betting that a $ 1 billion mortgage investment that they sold to investors, would fail. What's worse is that Citicorp helped pick half the mortgages they bet against and failed to tell the investors. This describes it graphically. On the day the transaction closed, an experienced trader wrote in an email that the portfolio was "dog sh*it" and "possibly the best short EVER!"

So, as I'm reading this I say to myself, the demonstrators outside got it right -- more than they could imagine. It wasn't just the foreclosures, bailouts and high executive salaries. Some financial institutions made huge profits bundling the bad mortgages and selling them to investors, then betting that the bundle would lose value."

'via Blog this'

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