A Manager’s Dilemma: Putting It into Practice To Disclose or Not Disclose? Bagley p. 131. Issue: Does Danimark have a legal duty or an ethical obligation to disclose Nelipern’s role in the selection process to potential investors? Is it enough if Danimark’s marketing materials to potential investors disclose that Nelipern helped select the portfolio‚ or should Danimark also disclose Nelipern’s adverse interests in the performance of the portfolio? Is this situation any different from a transaction
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GLOBAL FINANCIAL CRISES AND THE FUTURE OF SECURITIZATION Contents 1. Introduction……………………………………………………………………...3 2. Overview………………………………………………………………………...3 3. Structured-finance securitization ………………………………………………..5 4. Key segments of the securitization market………………………………………6 5. Rating Agencies Deficiencies....................………………………………………8 6. Future of Structured-finance securitization……………………………..……...10 7. Conclusion................................................…………………………………...…11
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bonds issued by special purpose vehicles (a corporate entity that holds the assets as collateral‚ packages them and sells the resulting notes to investors). Normally‚ the bonds issued are divided into tranches with different risk characteristics and debt rating. Each tranche carries a different rating which determines the interest and cash flow for each layer. There are several types of underlying assets that the special vehicle can buy. The most typical are corporate bonds‚ corporate loans‚ trust
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“The Economics of Structured Finance” by Joshu D. Coval‚ Jakub Jurek‚ Erik Stafford -A critical analysis- This paper is about the working of the Structured Finance (SF) machinery and also investigates about the spectacular rise and fall of structured finance. It discusses the challenges faced by rating agencies‚ particularly examining‚ the parameter and the assumptions of modelling that are required to arrive at accurate ratings of structured finance products. An attempt is being made to have
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The collapse of Bear Stearns: Five years on David Thomas 19 Mar 2013 This week five years ago‚ JP Morgan announced it would buy Wall Street rival Bear Stearns in a deal worth $2 a share – this ultimately rose to $10. Here‚ Financial News looks at the events in the run-up to the fall of the 85-year old independent investment bank. Financial News compiled the timeline from press releases‚ contemporary media reports and William D Cohan’s account of the collapse of the bank‚ ‘House of Cards’. May
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In assessing the ethical issues surrounding the Goldman Sachs Abacus controversy‚ there are several factors that must be taken into consideration. Despite John Paulson playing a limited role in the ultimate construction of the CDO by having a hand in the asset composition selection process‚ as well as Goldman’s lack of disclosure in excess of the law‚ it is important to recognize that the counterparties to the CDSs were sophisticated investors. As sophisticated investors‚ making large speculative
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Inside Job: Documentary Analysis Submitted to: Prof.Pramod Paliwal Submitted by: Meghavi Patel (20111030) The documentary is divide into five Parts‚ this write up describe my overall understanding of the documentary. In 5 year period of time 3 banks borrowed 120 million dollar which is ten times the size of the Iceland economy. Till the year 2006 anyone and everyone could get loans easily even if their document were not up to the mark‚ lenders did not care if the borrowers were unable to repay
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alternative to investing in corporate debt. Read more: http://www.investopedia.com/terms/a/asset-backedsecurity.asp#ixzz2Khw1KXkL A financial security backed by a loan‚ lease or receivables against assets other than real estate and mortgage-backed securities. For investors‚ asset-backed securities are an alternative to investing in corporate debt. Read more: http://www.investopedia.com/terms/a/asset-backedsecurity.asp#ixzz2Khw1KXkL Collateralized debt obligations (CDOs) are a type of structured asset-backed
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Kroll Bond Rating Agency (HBS 9-212-034) October 23‚ 2014 Tzyy-Shiuan Chiu‚ Yuanyuan Hao‚ Mofan Shi‚ Hsin-Ping Tso A Good Time and A Good Idea to Enter the Credit Rating Business Jules Kroll is planning to enter into the ratings industry. To determine whether it is a good idea and a good time for him to enter into the new business‚ we project the 5-year NPV for KBRA and apply SWOT analysis to KBRA. The 5-year projected NPV is $341.1 million‚ a positive number. It is a good time and a good idea for
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exceptionally high growth. Many Americans watched as their primary source of wealth become increasingly devalued. By late 2007‚ the prime mortgage markets were showing higher than normal default rates as well. Collateralized Mortgage Obligations (CMOs)‚ a type of collateralized debt obligations (CDOs)‚ allowed these problems to spread from the mortgage market to other sectors of the economy‚ having especially widespread effects on financial markets as a whole. CMOs were mortgage-backed securities issued
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