I read every email sent to me, and every comment written at my blog. But much as I would like to, I can’t answer them all. One comment to my last piece on this topic questioned the validity of accrual...
Read MoreOne quick note for readers before I begin: I passed my Series 86 exam with an 88% score. I did better than I expected. Now I am studying for the 87 — my how interesting it is to study law… BTW, the next...
Read MoreIn theory I agree that Central Banks should be free from political influence. In practice, I don’t. Why? Central Banks regularly cave into political influence. They are quick to loosen, and slow to...
Read MoreWhy do we have credit ratings? What are the main reasons they exist? To provide profits to those that rate credit. To provide credit standards for regulators and creditors (shame on you, do your homework) that can’t...
Read MoreThe above graph is lovingly culled from AIG’s 10-Ks for the past 23 years. It tells an amazing story, in my opinion, and you will get my view of AIG’s reserving. I am somewhat biased because I worked for...
Read MoreWhat if securitization allows the economy to expand more rapidly than it would at a price of volatility, when intermediaries would prove useful? Sometimes securitization and tranching creates securities for which there is no...
Read MorePrepayment and default are dual to each other. The less likely is default, the more likely is prepayment, and vice-versa. In a pool of loans, the critical distinction is the likelihood of loans to prepay or default. ...
Read MoreOne thing that I do differently than most investors is the concept of rebalancing. I buy and sell positions to maintain their weights in the portfolio, within a 20% band around the intended weight. As I wrote about...
Read MoreThis is a book about Harry Markopolos, who is the author of this book. He talks about how he attempted for years to expose the fraud that was Bernie Madoff. The book takes the following form (from my view of how the...
Read MoreThis idea is applicable to many fields, but in the era of the internet, this is a cheap idea that should gain broad acceptance. Academics would benefit from the creation of a journal of failed research. Rather, many...
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