The Piecemeal Man (abmann) wrote,
The Piecemeal Man

Leveraging the leveraged leverages.

HA! Credit Suisse devised a fantastic way to offload their dead mortgage debt - Executive Bonuses

The assets go into a pool from which the "bonuses" come. If the debt pool value increases, everyone earns that value increase. Otherwise, any decreases in value first remove value from the bonus before the company takes the hit. Further leveraging the debt is kind of scary but it buffers the company for a little while.

Brilliant! Lunatic!
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