However, I am unhappy to see these principles extended to credit card receivables, a subject which merits a separate discussion.
As a result, retailers turn to alternative financing options such as credit card receivables, which are very expensive.
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Such activity could even be coupled with purchases of bundles of securitized consumer loans, credit card receivables and even corporate securities.
Secretary PAULSON: Approximately 40 percent of U.S. consumer credit is provided through securitization of credit card receivables, auto loans, and student loans, and similar products.
If the principal is paid within the lock-up period, new loans will be added to the ABS with the principal payment that makes the pool of credit card receivables unchanged.
Turns out that the Primary Fund, like many other money market funds, made significant investments in asset-backed commercial paper (ABCP), which offered juicy yields, but did so because they were backed by things like mortgages, auto loans, credit card receivables and other risky assets that, despite their risk, came with investment-grade ratings.
Morgan Stanley and other big firms are also starting to rebuild their securitization business, which pools together auto loans, credit-card receivables, and other forms of credit, and then issues bonds backed by them.
The bank keeps its risks under control by selling off mortgage and credit-card receivables to bigger institutions.
America's government is working hard to revive markets for securitised debt, aware that banks lack the balance-sheet capacity to absorb all of those credit-card receivables and auto loans.
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Fastow dusted off an obscure financial tool previously used to sell credit-card receivables to separately capitalized funds (he'd probably learned about it earlier in his career at Continental Bank in Chicago) and morphed it into the infamous LJM, Chewco and Raptor partnerships.
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