Review of balance sheets. Difference between illiquidity and insolvency.
Course
Paulson Bailout
Videos to help understand the bailout.
16 Lectures
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Hypothetical bank balance sheet. What book value means.
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What it means when the market value of a stock is different from its book value.
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Different ways of accounting for an asset. Mark-to-model vs. mark-to-market.
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How the bank can liquidate assets to pay off debt that comes due.
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The bank gets bailed out by an equity infusion from a sovereign wealth fund.
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What happens when there is no equity infusion and the bank goes in to bankruptcy.
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How the banks are connected. What happens when one bank fails.
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What Paulson wants to do and why I don't like it.
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Alternate plans and moral hazard.
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Why a CDO could be worth nothing even though they are "collateralized".
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A real life example of a transaction involving CDOs.
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Can the bailout work?
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A solution that is MUCH fairer that has a MUCH better chance of working!
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More on the "Plutsky Plan".
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More on the "Plutsky Plan".