Warts And All

 

Into the Tranches

There is a relatively simple way to resolve the madness of the current credit situation. Have all the major mortgage holders; banks etc., take a representative sample of their loans that were bundled and sold and let them be exhumed and examined. Sellers and buyers of these products have to know what they bought and sold. There has to be identification numbers that can be traced. These samples of bundled mortgages could be reviewed and analyzed to determine their collective value. No less an eminence than Warren Buffet has stated that the way to ascertain the value of these exotic derivatives is to sell them. An appraisal of groups of said properties would give a good indication of their objective value and lead to a rational indication of their market value.