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For the condos, the collateral is receivables from the buyers (or their banks).
For rough idea, can google mortgage backed securities or collateralized mortgage obligations.
Those who read the book liars poker, should know the beginning of securisations.
"... but quitting while you're ahead is not the same as quitting." - Quote from the movie American Gangster
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Ha! Ha!
If only HDB flats can be securitised, wouldn't the business climate be better or worse?
WB:-
1) Rule # 1, do not lose money.
2) Rule # 2, refer to # 1.
3) Not until you can manage your emotions, you can manage your money.
Truism of Investments.
A) Buying a security is buying RISK not Return
B) You can control RISK (to a certain level, hopefully only.) But definitely not the outcome of the Return.
NB:-
My signature is meant for psychoing myself. No offence to anyone. i am trying not to lose money unnecessary anymore.
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(19-10-2013, 09:09 PM)Temperament Wrote: Ha! Ha!
If only HDB flats can be securitised, wouldn't the business climate be better or worse?
Cheng hu already securitized Hdb flats by selling us the L99 leases.
"... but quitting while you're ahead is not the same as quitting." - Quote from the movie American Gangster
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(19-10-2013, 09:28 PM)opmi Wrote: (19-10-2013, 09:09 PM)Temperament Wrote: Ha! Ha!
If only HDB flats can be securitised, wouldn't the business climate be better or worse?
Cheng hu already securitized Hdb flats by selling us the L99 leases.
Ya hoh! It's very difficult to rent a flat from Cheng Hu.
WB:-
1) Rule # 1, do not lose money.
2) Rule # 2, refer to # 1.
3) Not until you can manage your emotions, you can manage your money.
Truism of Investments.
A) Buying a security is buying RISK not Return
B) You can control RISK (to a certain level, hopefully only.) But definitely not the outcome of the Return.
NB:-
My signature is meant for psychoing myself. No offence to anyone. i am trying not to lose money unnecessary anymore.
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I chose to post the article here. After so many years, The JPMorgan still under-going a painful and expansive process to shake-off the liabilities of its sub-prime business. A lesson to be learned by banks too, along with retail investors.
JPMorgan in tentative US$13b deal over bad loans
WASHINGTON/NEW YORK — JPMorgan Chase & Co has reached a tentative US$13 billion (S$16.1 billion) deal with the US Justice Department and other government agencies to settle investigations into bad mortgage loans the bank sold to investors before the financial crisis, a source familiar with the talks said yesterday (Oct 19).
The tentative deal, the largest ever between the US government and a single company, does not release the bank from criminal liability for some of the mortgages it packaged into bonds and sold to investors.
That had been a major sticking point in the discussions, but the government refused to budge on that issue and JPMorgan felt it had no choice but to give in, according to a second source. Until recently, the most that JPMorgan was willing to pay was closer to US$11 billion.
The ongoing criminal investigation underscores how even if this settlement takes some heat off JPMorgan Chief Executive Jamie Dimon, he still has myriad regulatory issues to deal with.
...
http://www.todayonline.com/business/jpmo...-bad-loans
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(19-10-2013, 05:29 PM)opmi Wrote: Dbs just want to earn fee based income for creating structured products. Take a cut from multiple parties.
When project 50-70% sold, developers (and their bankers) home safe. Unless project overrun jialat jialat.
Since now no deferred payment scheme, the risk of sold condos already pass to the buyers and their banks. So don't think dbs scared of developers loans go bad.
Unless there is a big systemic crash in property market.
Correct. The risk and VOLUME involved for fee based income is better than risk principal.
Saying if DBS like it should have kept it is like saying developers should not sell any properties when properties are going up.
Securitisation is not bad per se. Strictly speaking listed equities are securitied businesses. Even in looking at value stocks we have to look at how the business is securities for eg capital structure, counterparty risks, etc
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