投行内部流转的次贷危机解释非常形象.ppt

Forget it,made a mistake,made a mistake,made a mistake,made a mistake,$#D&%$ !,Same to you. But Ive got my fees,Contributing Factors - Mortgages,Adjustable Rate Mortgages (ARMs) Honeymoon rate for initial period Borrowers betting on falling rates (didnt happen) or Rising house prices and refinancing (didnt happen) Origination Agents (not banks) creating the loans Dont care about impact on bank balance sheet No relationship angle Bad loans now in the bond market not the banks balance sheet,Contributing Factors - Origination,SPV are in non regulated jurisdiction Lack of regulatory oversight Investment bankers earn large fees Employee based incentive issue,Contributing Factors CDO/CMO,Recycled debt from prior securitisation Difficult for bond holder to assess risk on the underlying cash flows Rating Agencies Gave high credit rating Hedge Funds Begging for High Yield (risky) securities Unregulated Lack of direct issued quality debt for fund managers,Contributing Factors CDO/CMO,Equity (riskiest) tranche Cant sell so investment banks put on own balance sheet Leverage High return (cause is high risk, baby) Employee incentive schemes If they dont take it, the transaction wont happen so no fees Protect with Credit Default Swaps (CDS) Spreads the risk to other financial institutions (AIG),Domino Effect 1,US Fed raises interest rates 2005 rises from 2.25 to 4.25 2006 rises from 4.25 to 5.25,Domino Effect 2,Falling House Prices 2006,Domino Effect 3,Bond Market Securitised bond values fall as mortgages default Equity Market Rising uncertainty,Domino Effect 4,Loss of Confidence in US Markets Presidential election Ability of regulators to respond Transfer to USD asset classes and other currencies,US Sub Prime Crisis goes overseas,US Bond and Equity ma