Monday, March 23, 2009

My Toxic Assets

I have something to sell you that has no value. Actually, the truth is that I want to sell you something that has negative value – it’s actually worth less than nothing. I’ll put it another way: if you pay me ten dollars for this thing you will actually have to pay me another ten dollars very soon and quite possibly another ten dollars after that. But, before you start thinking that this is not a good deal for you I’ll throw a happy spin on it: I will loan you the money to buy it from me at a reasonable rate of interest – let’s say 5%. I don’t actually have the money to loan you but that’s another story and should not be a concern of yours. I’m good for it and all you have to do is begin paying me the 5% interest next month and then you can own this thing I have that has no value – negative value that is. I don’t really know what it is. It seems to be a bundle of something that nobody wants that was derived through a series of intricate maneuvers that no one really understands and then sold off in smaller sectors of insured assets and packaged into contracts sold through brokers on a global basis under the heading ’risk deferred.’ Everybody’s got one. What do you say?


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