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July 13, 2009

Comments

supra for boy

Beautiful!!! You truly have an eye for colour.

eric

Great points Fletch. Especially about the warehouse operation. Everybody got paid out of the same pot. Sales guys used to get nice credits for bringing in "mandates" from CDO managers and the carry and fees they produced all went into the same pot. Meanwhile, the secondary desk made liquidity at a loss to get guys into the next deal.

fletch

gs also one of the largest counterparties in the mkt to the biggest and baddest hedge fund players during this period (aka "the smart money"). their traders were proud of discussing the info advantage that came from these relationships. they facilitated liquidity but were definitely going the same way in their own books. as you've pounded away for a yr and a half, risk was laid off on the "dumb money".

let's also not forget that the guy that approved purchases of bonds or synthetic exposure for cdo warehouses (in virtually every shop across the street) was the same primary/secondary trader that handled all the custy flows/information. the system was almost perfectly centralized on 1 desk w/very little oversight or restraint

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