Thursday, October 15, 2009

A Bucket of Junk

A bucket of junk is always a bucket of junk. In the eyes of the regulatory bodies a bucket with a little junk is still a bucket of junk but if it is filled to the rim with junk it could be rated as almost investment grade. If that's not a folly, what is?

Basel II has created a collateralized attitude to risk management.



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