My Favorite Business Resources
- Cheap Business Phone Service - Make phone calls anywhere for free or darn close to it.
- Cheap Printing - Always amazing deals on cheap printing with loads of free items.
- Manage Mobile Phone Costs - Great phone for controlling cell phone costs for business or teenagers.
- Really Good Web Hosting - As bullet proof as there is. A strong hosting provider with all the resources you need.

My Favorite Credit Resources
- Consolidate Your Debt - One monthly payment. Stop collection calls.
- Help Budgeting - Online and easy.
- Lower Your Car Payment - Refinance to reduce your monthly payment.
- Credit Report / Credit Score - This consolidated report is better than most.
- Credit Cards - Find the best card for you for low rates, balance transfer, credit rebuilding and rewards.

Jan

2008

Enronesque - Bear Stearns CDO Funds Described as Pyramid Scheme

Posted by Steve Rhode as Banking

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I just finished reading an article from Business Week that did a good job of explaining how the subprime mortgage mess got a foothold to begin with. The article “The Bear Flu: How It Spread” brings up an excellent point that since Bank of America and Citibank guaranteed the funds that there existed a large gap between the originators of the loans and the people holding them at the end.

As the article states, “The complexity of the Kilos and their ilk only encouraged lax lending practices by putting too much distance between the borrowers and the ultimate holders of the debt. Since the Kilos offered a refund policy, money-market managers didn’t have to worry about wheather home buyers would pay back their loans.” - Business Week

As someone mentioned early on in this banking crisis, “It sure smells a lot like Enron” and apparently it does have some similarities. It will be interesting to see how this all settles out. One thing for sure about bankers, they don’t laugh and joke, not forget when someone loses $10 billion of their money. I can only imagine what the late fee or overlimit charge is on that puppy.

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Steve