Never discount Wall Street’s ability to turn the most basic parts of life into profits. Mother nature is the latest money spinner for financial firms. Despite the recent Northeast snowstorm, the unseasonably warm winter, and in general a lack of snow, could turn into big profits for the banks, brokerages and insurance firms that deal in so-called weather derivatives.
So far it appears the most noteworthy document of the 250,000 pages obtained by the House Committee on Government Oversight and Reform, which is holding a hearing on Wednesday on AIG’s government bailout, is a 44-page powerpoint presentation put together by bond firm Blackrock analyzing the insurer’s ability to negotiate haircuts on its largest CDS [...]
A reader (well, this Pulitzer-winning genius newspaper columnist of a reader), e-mails after reading my book: From the very beginning of financial capitalism, the goal seems to have been to beat the market, which is to say, anticipate and profit the upside and downside of the market—not the industry or business of the stock traded. [...]
