the CDO and his involvement in selecting the portfolio. The SEC states that this was material information that would have alerted them to the high risks. 3. ACA was told by Goldman that Paulson was long equity in the CDO. The equity tranche is at the bottom of the capital structure in a CDO and if the underlying RMBSs were to fail‚ it is the first to experience losses. This led ACA to assume that since Paulson was long equity on the CDO‚ it had an incentive to ensure the success of the CDO‚ which
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1 - Summary - Inside Job - Introduction - 1)Inside Job opens with a case study of Iceland‚ a nation that was possessed by the cancer of free radical finance. 2)Iceland was stable – low crime‚ strong education‚ strong stability in social and financial systems. 3)Multinational corporations such as Alcoa were then allowed to come into Iceland and install their business thereby disrupting the integrity of the system. 4)Three of their largest banks were privatised and in only five years‚ they combined
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Morgan Stanley‚ Lehman Brothers‚ and Goldman Sachs‚ then the investment bank combine those mortgage to create a complex derivatives called a Collateralized Debt Obligation (CDO) and sell the CDO to investors around the world. Investment bank pay rating agency to evaluate CDO and many of them are given a triple A rating so that the CDO is pretty popular among the investors. However‚ problems emerge when the lenders realize that they could give away endless loans because they will sell these loans to investment
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ANALYSIS OF THE DOCUMENTARY MOVIE “INSIDE JOB” Basic Information about Documentary: Directed by Charles Ferguson Produced by Audrey Marrs Charles Ferguson Narrated by Matt Damon Music by Alex Heffes Cinematography Svetlana Cvetko Kalyanee Mam Editing by Chad Beck Adam Bolt Distributed by Sony Pictures Classics Release date(s) May 16‚ 2010 (Cannes) October 8‚ 2010 (United States) Running time 108 minutes Country United States Language English Introduction: US Financial crises in 2008 hit all economies
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Corazon D. Ong-CDO Foodsphere‚Inc. Corazon D. Ong is a dietitian by profession who used her knowledge to create affordable processed meat products that could compete with the already well known and established processed meat brands. Initially‚ it was only a hobby where she could put to good use her creativity and skill in culinary arts. She came up with corned beef‚ hotdogs‚ meatloaf‚ hamburger patties and ham‚ an entity that she later sold as a home business. She founded CDO Foodsphere in 1975;
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administration quickly shut it down. Perhaps the most startling practice on Wall Street is the creation of CDOs – “collateralized debt obligations” and the false ratings they were given. First‚ home buyers took out loans. Lenders then sold these mortgages to investment banks. Investment banks combined these mortgages with other loans and debts (such as car loans‚ student loans‚ and credit card debt) into CDOs and sold them to investors. As a result homeowners ended up owing investors. The problem was that
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the Collateral debt obligation and rating agencies who rate them. CDO is acronym for Collateralized debt obligation. Longstaff and Arvind (2008) describe CDO as: “financial claim to the cash flows generated by a portfolio of debt securities or‚ equivalently‚ a basket of credit default swaps (CD contracts)”. To find out the main reason for this crisis‚ it is important to know how these CDOs work. Figure shows how the CDOs works from Final Report of the National Commission on the Causes of
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James Rodden Business Ethics Summer 2013 The Goldman Abacus Fund: Ethics You Can Count On Or Ethics That Don’t Add Up Set Up Imagine a physician is on the golf course with one of his colleagues‚ who happens to be a cardiologist. Somewhere on the back nine the cardiologist begins to tell the physician about one of his patients‚ a 52 year old man with blood pressure of 145/99‚ who is 40 lbs. overweight‚ chain smokes‚ and enjoys
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CAMIGUIN POLYTECHNIC STATE COLLEGE – Institute of Engineering and Computer Studies ACKNOWLEDGMENT The trainee extends his warm appreciation and gratitude to those who helped in the completion of his training. To the trainee’s parents and relatives for their endless support both moral and financial. To the OJT – in – charge‚ Engr. GIL B. SALAS for his teachings and reminders to be a good and responsible trainee and enrolling the trainee on their OJT. To the engineering instructors‚ for molding
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asset. Banks offered adjustable-rate-mortgage (ARMs) and Subprime loans to all kind of people with good or bad credits scores as they wanted higher revenue when they resell the bundled subprime mortgages called the Collateralized debt obligations (CDOs) and Mortgages-backed securities (MBS) to the other Investors around the world. The subprime crisis had shaken Northern Rock bank so badly that they had a hard time seeking help to keep the business going. The British banks Lloyds TSB group Plc had
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