On Speculative Losses

“Bear Stearns didn’t have a clue how much money it had lost. Nor would you if you had sunk all your money – or rather, all your clients’ money – in CDOs built upon CDSs reckoned against MBSs based on mortgage loans made to people with no hope of making their monthly repayments.
Adrian Ash


Yesterday, July 16, Bear Sterns was supposed to announce how much it suffered from the recent bust of two of its highly-leveraged hedge funds that were invested heavily in CDOs and other hazardous subprime-credit material. Still no word from Sterns.

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