[ExI] Was it just greed?

[Harvey Newstrom]

"Stathis Papaioannou" <stathisp at gmail.com> wrote,
> A new factor was the existence of Credit Default Swaps, by which
> financial institutions believed they could insure against losses. It
> didn't work out that way.

Actually, it did, for the dishonest ones.  In a non-intuitive process, 
institutions could maintain their insurance even after they sold the toxic 
assets to other institutions.  In this way, the original insitution made 
money on the failures, while others got stuck with the bill.  This is the 
basis of some current fraud investigations.

--
Harvey Newstrom <www.HarveyNewstrom.com>