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We Bought a Toxic Asset; You Can Watch It Die

Toxic assets — home mortgages packaged into complicated bonds that no one wanted to touch when the housing bubble collapsed — are starting to trade again.  We wanted to figure out how this chapter of financial history will end.  So we decided to buy a toxic asset of our own.  You can here the story here and the longer podcast version hereHere you can find a graphic of our new pet.

Soon after we bought her, we found out that our toxic asset has a large and troubled family.  The Federal Reserve bought her younger sister and a lot of other weird stuff while trying to save the banking system.  The carpenters of NJ and the Boilermakers of America bought another sibling during the height of the boom and now they are suing their toxic asset.

We are tracking our toxic asset’s progress here.  So far it’s not going well.