SweetMercifulPussSpewingDeath! CDO's are back!

[The Comrade]

OWS has been trying to do that interestingly enough

[exploited]

[The Comrade]

i don't think you're going to find some organized NPO doing this at all.

[eynon81]

[exploited]

[eynon81]

[Kane]

Credit unions. Gotta watch which ones...but credit unions.

Dun.

Asking everybody to stop making payments on their debts will never work. Too many families are just trying to get by, they'll prioritize the children, school, food, housing, etc. I wouldn't do it either. Why would I want to tarnish my credit rating when I have absolutely no guarantee that others will follow to the degree necessary to necessitate change?

It's going to take another crash. People will have to have nothing to lose and/or be incredibly livid.

[exploited]

[Kane]

[calicon]

As a proper reactionary, let me just step in really quick and say that CDOs are not the end of the world by any stretch of the imagination. Like any ABS, you're going to have difficulties when risk models are used improperly (and for what it is worth, even though the models are going to be imperfect, that still isn't a problem until you start getting over-reliance on them (and the further away you get from the actual product the bigger the error propogates)). CDOs aren't even the biggest culprit in the downturn, or even the most egregious. I get much more worried about things like PIK bonds or CDO-squareds.

Of course, there's a simple solution to dealing with CDOs (and, frankly, most financial ills) that has nothing to do with banning them: capital. Capital makes up for a world of ills, and merely structuring capital requirements properly could do more than anything else to make sure that the cases where CDOs make sense are still used but discouraging over-reliance on instruments that are, admittedly, prone to problems.