Wall Street Pursues Profit in Bundles of Life Insurance

[Elmore Furth]

And nothing can go wrong with bundling schemes, right?

I'm betting they haven't looked at the worst case scenerios.

September 06, 2009
After the mortgage business imploded last year, Wall Street investment banks began searching for another big idea to make money. They think they may have found one.
The bankers plan to buy "life settlements," life insurance policies that ill and elderly people sell for cash - $400,000 for a $1 million policy, say, depending on the life expectancy of the insured person. Then they plan to "securitize" these policies, in Wall Street jargon, by packaging hundreds or thousands together into bonds. They will then resell those bonds to investors, like big pension funds, who will receive the payouts when people with the insurance die.
The earlier the policyholder dies, the bigger the return - though if people live longer than expected, investors could get poor returns or even lose money.
Either way, Wall Street would profit by pocketing sizable fees for creating the bonds, reselling them and subsequently trading them. But some who have studied life settlements warn that insurers might have to raise premiums in the short term if they end up having to pay out more death claims than they had anticipated.


Wall Street Pursues Profit in Bundles of Life Insurance

[The_Casual_Observer]

1. At one time wall street actually invested in american manufacturing companies.

Now this is the kind of shit they do instead. I'd say that the whole thing is unsustainable at this point.

[ixion]

2. yeah, because Mortgage-Backed Securities worked out so well.

:eyes:

[northernlights]

3. well, this will work better than mortgage backed securities

at least until they've killed all of us off.

They're driving us out of our homes and into the streets. Poisoning us with gmo food. Killing healthcare reform. Obviously, now, they anticipate a massive die-off of disposable commodity resource units. May as well make a buck off it. :eyes:

[dixiegrrrrl]

4. The banksters are trying SO hard to get another bubble going.

Hopefully, more and more of us "plain folks" will learn to live in alternative economy groups, like bartering, community money, etc.

[CatholicEdHead]

5. "Dead Peasants Insurance" taken to a whole new level

Disgusting :puke:

[AdHocSolver]

6. The ONLY protection is to make such transactions illegal.

Any government that does not outlaw such practices after what happened to the banking system with the bundling of mortgages is incompetent, immoral, and most assuredly corrupt.

We are witnessing the destruction of the U.S.A. by a cabal of crooks whose avarice and stupidity surpasses that of the robber barons and the mobsters of the twentieth century.

[AdHocSolver]

7. Delete dupe. n/t