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How credit cards become asset-backed bonds

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By Barry Ritholtz - December 6th, 2008, 4:00PM


How credit cards become asset-backed bonds from Marketplace on Vimeo.

Mortgages aren’t the only financial instruments that get turned into securities. In this video, Marketplace Senior Editor Paddy Hirsch explains how companies make money by buying credit card debt and bundling it.

All of “The Marketplace Whiteboard” videos can be accessed at www.marketplace.org and are part of “Fallout: America’s Financial Crisis,” Marketplace’s comprehensive coverage of the current financial crisis.

hat tip boingboing

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2 Responses to “How credit cards become asset-backed bonds”

  1. Mark E Hoffer Says:
    December 6th, 2008 at 5:15 pm

    BR,

    you keep running stuff like this, you’ll need a “Disinfo/Agitprop”- Tab on TBP 1.1

  2. leftback Says:
    December 7th, 2008 at 12:29 pm

    It’s great how the financial services kept on setting up things that would shoot them in the ass down the road. Traders are going to be able to ride the SKF for a few years before this is all over.