We’ve heard lots about how mortgages get turned into tradeable securities, but they’re not the only thing. No no no, there was far too much Chinese money not able to earn anything on T-bonds for us to let them lie. Credit cards can become asset-backed bonds too. Marketplace’s Paddy Hirsch is back with his whiteboard and dry-erase markers to explain how it works. Video inside.
Call it what you will, the borrower bailout/rescue/whatever does not seem to be working. Foreclosures are still on the rise along with defaults and sad stories. And while those numbers go up, the economy continues to worsen.