Liar's Poker: Rising Through the Wreckage on Wall Street - The Fat Men and Their Marvelous Money Machine Summary & Analysis

Michael Lewis (author)
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This section contains 492 words
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In October 1981, Congress passes a tax break that allows thrifts to sell their money losing mortgage loans and reinvest the proceeds for higher returns. Losses incurred by these mortgage loan sales can offset any taxes paid over the previous ten years. Thrifts have a lot of bad loans to sell. Ranieri's mortgage traders at Salomon are the only ones buying. Thrifts have to sell to remain in business. The hundreds of billions of dollar turnover is a massive subsidy to Wall Street. Bob Dall is correct about mortgage business growth but the source is not housing demand. Thrift managers must sell the loans whether or not they understand Salomon's terms. Ranieri has the whole loans they buy transformed into bonds by getting a stamp of the U.S. Government agencies nicknamed...

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This section contains 492 words
(approx. 2 pages at 400 words per page)
Buy the Liar's Poker: Rising Through the Wreckage on Wall Street Study Guide
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