Tuesday, October 21, 2008
Forrest Gump explains Mortgaged Backed Securities
Visualize a puzzled Forrest with a box of chocolates on his lap and speaking. "Mortgage Backed Securities are like boxes of chocolates. Criminals on Wall Street stole a few chocolates from the boxes and replaced them with turds. Their criminal buddies at Standard & Poors rated these boxes AAA Investment Grade chocolates. These boxes were then sold all over the world to investors. Eventually somebody bites into a turd and discovers the crime. Suddenly nobody trusts American chocolates anymore...
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