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Friday, August 17, 2007 12:00 AM

Panic on Wall Street

You've heard about the home-loan bust, but do you know your derivatives from your tranches? Read Salon's easy guide to understanding the current market freakout.
By Andrew Leonard

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  • Friday, August 17, 2007 11:30 AM

    Here's what they do

    You take a bunch of garbage loans and break off the income streams. Then you pool them with a bunch of good loans and blend them all together until your B risk becomes an A risk or better. That reduces the overhead costs in the reinsurance and monoline pools. It's called Gold Plating. Or as we used to call it "Don't look too hard up that Rhino's ass".

    —Anonymous

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