Il più Grade Trade della Storia

• 16:46 13/02/10
• Markit è un sito posseduto da alcune banche che registra quello che dette banche riportano su CDS che loro e solo loro trattano in modo opaco e non regolamentato, tipo delle scritture private vedi qui ad esempio la storia del nostro Paolo Pellegrini e John Paulson and the Greatest Pump and Short Fraud Ever sui CDO dei mutui suprime che da un idea di come funziona Paolo Pellegrini e John Paulson sono andati dalle Goldman, Deutsche, Morgan e hanno detto: "...vogliamo che ci create un derivato sull'indice dei mutui e ci mettiamo dentro però alcune centinaia di mutui che vi diciamo noi, prendiamo i più assurdi e marci, quelli fatti a immigrati e neri che non restituiranno mai, ma li misceliamo con altri in modo che il rating rimanga buono ...Poi voi a Morgan e Goldman e Deutsche andate da AIG e create assieme a loro che sono un assicurazione, un "assicurazione sui mutui" un Credit Default Swap su questo "Indice dei Mutui Marci e Senza Speranza fatti a Messicani, Hiatiani e Negri" (ma con un nome magari più rassicurante, tipo "High Yield Asset Backed Securities...") ....Avrai tante istituzioni che lo comprano, paga un 7%, ha un rating ancora discreto e ci compri un assicurazione sopra per sicurezza per voi lo emettete forse a 100, lo vendete ai vostri clienti a 100 e noi lo vendiamo simultaneamente subito short per 20 miliardi a 100. ....Sappiamo che crollerà a 50 centesimi, se va bene, noi quindi andiamo short un derivato che abbiamo costruito apposta assieme a voi sapendo che dentro è marcio e perderà il 50% facciamo miliardi, voi ci guadagnate un 2% sul controvalore della transazione che sono decine miliardi di controvalore e verso i vostri clienti direte che era difficile prevedere che il valore delle case possa scendere ecc..., AIG guadagna anche lei una commissione, ...e le istituzioni che se lo comprano fidandosi che è Citi, Morgan e Goldman che assime ad AIG e con il rating di Moody dicono che è assicurato... beh...

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  “Paulson and [partner Paolo Pellegrini] were eager to find ways to expand their wager against risky mortgages. Accumulating it in the market sometimes proved to be a slow process. So they made appointments with bankers at Bear Stearns, Deutsche Bank (NYSE:DB), Goldman Sachs (NYSE:GS), and other banks to ask if they would create CDOs that Paulson & Co. could essentially bet against.” As Fiderer explains, Paulson asked the banks to create those CDOs “so that they could be sold to some suckers at close to par. That way, Paulson’s hedge fund could approach some other sucker who would sell an insurance policy, or credit default swap, on the newly minted CDOs. Bear, Deutsche and Goldman knew perfectly well what Paulson’s motivation was. He made no secret of his belief that the CDOs subordinate claims on the mortgage collateral were close to worthless. By the time others have figured out the fatal flaws in these securities which had been ignored by the rating agencies, Paulson could collect up to $5 billion.. “Paulson not only initiated these transactions, he also specified the terms he wanted, identifying which mortgages would be stuffed into the CDOs, and how the CDOs should be structured. Within the overall framework set by Paulson’s team, banks and investors were allowed to do some minor tweakin.” It is not clear which banks ultimately participated in Paulson’s scam, but Fiderer quotes Bear Stearns trader Scott Eichel as saying that his bank refused. “It didn’t pass the ethics standards;” Eichel said, “it was a reputation issue and it didn’t pass our moral compass^. We didn’t think we could sell deals that someone was shorting on the other side.” Bear Stearns’ moral compass was usually pointed towards the darker regions, but perhaps this is why Paulson subsequently became one of the more eager short sellers of Bear Stearns’ stock. Fiderer continues: “Prior to 2006, there were not many opportunities for naked short selling on subprime securitizations. But in January of that year, investment banks launched a new product, which enabled Paulson to place those bets on a large scale. The ABX index, a sort of Dow Jones Average of subprime mortgage securities, facilitated benchmarking the price of credit default swaps.” In fact, it was a black box company called the Markit Group that created the ABX index. The banks were minor shareholders in Markit Group and provided data. I have noted in a previous blog that the Markit Group is a dubious outfit to say the least, and there is good reason to suspect that the direction of the ABX index was influenced by hedge fund managers and their allies at the big banks. I do not have evidence that Paulson was one of those hedge funds, but authorities ought to be asking questions. Fiderer goes on to suggest that bad loans to homeowners were a significant cause of the financial crisis. On this front, I disagree with him. Certainly, some mortgage lenders were unscrupulous, and there was a certain amount of predatory lending, but the conventional wisdom that this is what crashed the economy is simply false. At the time that the mortgage securities markets began to go south in 2007, defaults on subprime loans had increased only slightly month-to-month, and were in fact considerably lower than in earlier years. In the second quarter of 2007, for example, only 7.7 percent of subprime loans were 30 days past due, slightly up from 6.76 percent in the second quarter of 2006, but considerably lower than the 9.9 percent in the second quarter of 2001. The problem lied not in the loans themselves, but in the fact that the loans had been packaged (apparently, to a large extent, at the behest of John Paulson and perhaps other bearish billionaires) into fraudulent securities that were traded and probably manipulated by a select number of hedge funds and large banks. In a somewhat similar scheme, hedge funds often pump up the stock of public companies before initiating short selling attacks aimed at demolishing those same companies. The economy was brought to its knees by a few powerful and eminently dirty players on Wall Street, not by poor people who had the temerity to buy themselves houses.

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