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I sincerely hope they are not proposing to buy CDO2.

As Pierre has warned repeatedly, apparently Spanish institutions did a round of securitization last year for the sole purpose of taking advantage of the ECB's repo facility. I would hope that the need to make and rate them in haste would imply that they are relatively simple in structure. If what is happening is that the ECB is selling them back to the banks and the Spanish Treasury will buy them, we might be okay.

A vivid image of what should exist acts as a surrogate for reality. Pursuit of the image then prevents pursuit of the reality -- John K. Galbraith

by Migeru (migeru at eurotrib dot com) on Fri Oct 10th, 2008 at 03:52:35 AM EST
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