• September 7, 2018

    Regrets of creator of collateralized mortgage obligation

    Lew Ranieri regrets creating the CMO “‘I’m the guy who played a central role in this home thing and I regret it because…it got abused beyond everybody’s imagination, ‘” says Lewis Ranieri, creator of the collateralized mortgage obligation (CMO), according to the Wall Street Journal. Ranieri’s creation of the CMO was nifty financial engineering by a sophisticated Wall Street investment banker that revolutionized the home mortgage market. But the CMO ended up being a financial weapon of mass destruction that crashed the global economy in 2008. The CMO brought us the Great Recession, from which we are still recovering.

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  • orangutan
    August 24, 2018

    Our brains cause us to make bad investment decisions

    We invest like Dr. McCoy, not like Mr. Spock. As investors, we make bad investment decisions because we are emotional, distractible, impatient, and inconsistent. But that is not our fault. There are things that developed in our primitive brains that do not help us when we have to make decisions about complex matters like investments. Knowing how our brains are hard-wired can help us to avoid the tragic mistakes that we so often make in investing.

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  • heart made of hearts
    July 11, 2018

    The gift of material nonpublic information

    Material nonpublic information – the perfect gift The gift of material nonpublic information always fits, is never returned, and can be regifted easily. It is the perfect way to say “I love you.” The SEC has filed an action against Robert Carr and Katherine Hanratty for illegal insider trading in the shares of Heartland Payment Systems, Inc. (“Heartland”), a New Jersey-based company, ahead of its December 15, 2016 announcement that it was to be acquired. 

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  • gate with private sign
    June 25, 2018

    Private placements – great for broker, not so much for investor

    Private Placements – what are they? Private placements can be stocks, limited partnership interests, or other securities issued by companies that are not publicly traded. Private placements can be investments in things like a single apartment complex, a single oil well, a basket of properties or oil wells, or a biotech company. The companies issuing these securities do not have to comply with many federal securities laws such as publicly filing their quarterly and annual financial statements. They are not required to provide ongoing disclosures to investors like public companies are. You cannot sell these securities on exchanges like the NASDAQ or NYSE when you need money.

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