The American Empire in a Changing World


Friday, October 12, 2012

RepoWatch: "Something about the financial crisis doesn’t add up''

a must follow blog, tons of great info about shadow banking...................From RepoWatch

''It turns out that one-fourth of the mortgages supposedly sold to investors were actually held by the bankers. Those bankers often used the mortgages as collateral to get overnight loans from each other and from other financial institutions.

This kind of borrowing has a name. It’s called repurchase (or “repo”) borrowing, because technically the borrower sells the collateral to the lender and promises to buy it back, to “repurchase” it, the next day – although usually the lender agrees to renew the loan for another day.''

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