Comments on: What’s the hullabaloo surrounding Schwab?

By: Lessons to learn from Berkshire's Charlie Munger: Why it makes sense to bet at the track | New Rules of Investing

Sun, 23 Aug 2009 13:15:00 +0000

[...] the market for adjustable-rate securities basically just got-up-and-went (witness the current Cuomo-led suit vs. Schwab), sellers were having a hard time pricing what they were left holding, let alone selling them. [...]

By: newrulesofinvesting

newrulesofinvesting — Tue, 18 Aug 2009 19:35:09 +0000

Hi cate_long,
You're totally right. I'm not trying to exonerate the brokers here. It's a total mess.

I just find it extremely hard to believe that the gov't is requiring them to backstop all these transactions. If there's a problem with the product or with the way these securities are being marketed, address that issue. Don't retroactively require the BDs to essentially insure everything.

By: cate_long

cate_long — Tue, 18 Aug 2009 18:28:57 +0000

Hi...

There's a little deeper history of auction rate securities and broker dealers. Innocence of the facts is not an effective broker defense.

http://freerisk.org/wiki/index.php/Auction_rate...