Green Options » investment banking http://greenoptions.com/tag/investment-banking Posts tagged 'investment banking' Tue, 23 Sep 2008 17:40:05 +0000 http://wordpress.org/?v=2.5.1 en From Mortgage to Bailout: How Did The Problem Arise? http://inspiredeconomist.com/2008/09/23/from-mortgage-to-bailout-how-did-the-problem-arise/ http://inspiredeconomist.com/2008/09/23/from-mortgage-to-bailout-how-did-the-problem-arise/#comments Tue, 23 Sep 2008 17:40:05 +0000 Reenita Malhotra http://inspiredeconomist.com/2008/09/23/from-mortgage-to-bailout-how-did-the-problem-arise/ House of CardsAs the government begins to unleash a highly criticized bailout plan for Wall Street’s toxic mortgage backed assets, it is worth taking a step back to understand how the problem actually arose.

Investing In Real Estate

It all started with real estate investing which involves the purchase, ownership and sale of real estate for profit. Real estate is an asset form with limited liquidity relative to other investments, it is also capital intensive (although capital may be gained through mortgage leverage) and is highly cash flow dependent. The primary cause of investment failure for real estate is that the investor goes into negative cash flow for a period of time that is not sustainable, often forcing them to resell the property at a loss or go into insolvency.

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]]> http://inspiredeconomist.com/2008/09/23/from-mortgage-to-bailout-how-did-the-problem-arise/feed/ Death of Wall Street, Rise of Main Street http://inspiredeconomist.com/2008/09/22/death-of-wall-street-rise-of-main-street/ http://inspiredeconomist.com/2008/09/22/death-of-wall-street-rise-of-main-street/#comments Mon, 22 Sep 2008 20:21:40 +0000 Reenita Malhotra http://inspiredeconomist.com/2008/09/22/death-of-wall-street-rise-of-main-street/ Morgan Stanley

The beginnings of another new economy are taking shape as Morgan Stanley and Goldman Sachs prepare to close the curtain on investment banking.

Mitsubishi UFJ Financial Group Inc., Japan’s largest bank, will inject 900 billion yen ($8.4 billion) into Morgan Stanley to help it transition to a bank holding company. Goldman Sach’s strategy is slightly different albeit with the same ultimate objective i.e. to become a commercial bank. According to Bloomberg, Goldman already has in excess of $20 billion in customer deposits in two subsidiaries and is creating a new one, GS Bank USA, that will have more than $150 billion of assets, making it one of the 10 largest banks in the U.S.

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