December 2, 2008

Super Senior

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SUPER SENIOR….Looking for more financial geekery? Sure you are! The other day I asked Felix Salmon to explain super senior tranches for us, and today he obliges. It’s too complicated to excerpt, but the nickel version is that it became yet another way for banks to increase their exposure to subprime loans by creating a synthetic version of the subprime market that was even bigger than the original. So instead of merely idiotically missing the housing bubble and losing lots of money on supposedly safe subprime-backed CDOs, they idiotically doubled (tripled? quadrupled? who knows) their bet by creating lots of synthetic subprime CDOs and then keeping them on their own books instead of selling them off. When the crash came, then, they lost money on both the real stuff and the synthetic stuff.

The full story is here. Enjoy!

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3 DAYS LEFT—AND EVERYTHING RIDING ON IT

A full one-third of our annual fundraising comes in this month alone. That’s risky, because a strong December means our newsroom is on the beat and reporting at full strength—but a weak one means budget cuts and hard choices ahead.

With just 3 days left, we need a huge surge in reader support to get to our $400,000 year-end goal. Whether you've given before or this is your first time, your contribution right now matters. All gifts are 3X matched and tax-deductible.

Managing an independent, nonprofit newsroom is staggeringly hard. There’s no cushion in our budget—no backup revenue, no corporate safety net. We can’t afford to fall short, and we can’t rely on corporations or deep-pocketed interests to fund the fierce, investigative journalism Mother Jones exists to do. That’s why we need you right now. Please chip in to help close the gap.

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