Banking, finance, and taxes
A Panic In Mortgage-Backed Securities? More Damage For Citi (C)?
Published:
The FT says that the "super-fund" to bail out financial instruments tied to mortgage-backed securities may be dead. Speaking about the fund to the paper: “As far as we can see, it appears dead in the water right now,” said one senior Wall Street banker.
Rating agencies Standard & Poor’s and Moody’s have received default notices for $5bn worth of the vehicles, known as collateralised debt obligations, giving holders of senior debt the right to sell assets.
The FT adds that "some observers fear it might now prove impossible to create the superfund quickly enough to help banks deal with the funding problems dogging SIVs – off-balance sheet entities that use short-term debt to fund longer-dated investments."
If the fund falls apart, watch for the level of write-off at Citicorp (C) to spike up sharply. If so, the Citi stock could go through the floor
Douglas A. McIntyre
Want to Retire Early? Start Here (Sponsor)
Want retirement to come a few years earlier than you’d planned? Or are you ready to retire now, but want an extra set of eyes on your finances?
Now you can speak with up to 3 financial experts in your area for FREE. By simply clicking here you can begin to match with financial professionals who can help you build your plan to retire early. And the best part? The first conversation with them is free.
Click here to match with up to 3 financial pros who would be excited to help you make financial decisions.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
