Many critique Wall Street on this mess. Well, folks, yes Wall Street bears some blame, but let me remind you the reader on what was a prime motivator. Read the blog, I really want you to. This blog entry was written in February 2007, just months before this mess was about to start.
Same payment with each scenario…except you’re able to buy $132,725 more home using a 40 year fixed over the 15 year fixed and  $107,750 more home with the 30 year fixed mortgage.    With an interest only product, such …

Time and time again I hear about how banning shorting, or restricting shorting is counter-productive and would require banning or restricting going long. I had a think about this over the weekend and have come to the conclusion it is not the same thing, but very different in two major aspects; psychology, and impact on the innocent.

You have all probably heard what Steinbrueck has said..
Steinbrueck criticized the United States for failing to adequately regulate investment banks and said free-market policies embraced by the United States and Great Britain that emphasized a short-term "insane drive for higher and higher profits" were partly to blame for the crisis.

So what is his solution?

The finance minister said he would push for a global ban on speculative short selling and would use next month’s meeting of the Group of Seven finance ministers and central bankers in Washington to press for new …

Daily Kos is a left-wing political blog, but they have a pretty good writeup of what is happening with these “credit swaps” and AIG, etc.
It reminded me of reading about mortgage-backed securities about this time last year, just as the shit was hitting the fan in the mortgage market. Now I’m learning about credit default swaps and credit-linked notes.
My questions is: what obscure trading vehicle am I going to be reading about next year? What are the other iffy, confusing, opaque, speculative trades that are going on out there?

A couple of days ago Cramer ranted on how the SEC should do something about shorting. On July 30 of this year I complained about naked shorting! I have had debates with many people on this issue. What the SEC has done is superb!

The market is down because of the de-leveraging taking place. They are selling because they have to sell…
How do I know? Whispers and those stocks that have been heavily shorted are up. I also don’t think that there is money waiting on the sidelines. I think that is a fairytale!
BTW I am putting in my orders to buy heavily!

The financial community right now is in melt-down and many think that the world is coming to an end. The question many are asking if the investment banking model is dead?
Answer, no, it will just morph. The thing about finance is that it works until it does not work anymore. So right now things are not working for the classical investment banks. Companies like Blackrock will move from second tier to first tier. Nothing wrong with that. I also noticed that the CEO and other partners at Blackrock are making …

This financial crisis has many people saying it was this that or the other thing. I want to present this FAQ as a reference point of what happened. If anybody wishes to add something please send me an email or comment and we can discuss it.
Who is at fault
There are two main culprits, the regulators and politicians, and the quants. Some like to argue that Alan Greenspan is the main culprit because of his low interest rate policy. I personally believe Alan Greenspan is an actor, but not a main …

In the fall I am giving a class at a conference that is an introduction to financial engineering for software developers. I have talked to my clients, and talked to people at the IB I work at.
Yet all of their answers results in what could be called statistical insignificance. So I thought, why not throw it out to the readers. If you were to attend a talk called Introduction to Financial Engineering for Software Developers, what would you expect to hear?
I don’t want to give any ideas since ideas lead …

The question is if Fanny and Freddie is the right action at the right time or if it is socialism? Many like to say hey this is an act of the USSR or what have you.
Let me give the perspective of a non-American. Though let me give you the perspective of somebody who likes America, has American friends and is pro-American.