This year, the former partner at lobbying firm Patton Boggs LLP also found a unique solution to an even bigger housing problem: getting money back for investors in residential mortgage-backed securities that went bad. Franklin created a clearing house where investors can pool claims and potentially create the necessary legal clout to force mortgage lenders to buy back improperly made loans at the heart of the securities.
Before Franklin’s innovation, investors in such securities had no way of knowing who other investors were. Franklin’s approach may cost banks such as Bank of America Corp. billions of dollars. Lenders can be required to buy back securitized mortgages if they misrepresented their quality.
Can't you see the vast majority of the investors just using PHDC in Bloomberg (the article is written by Bloomberg) or use one of the other data providers?
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no i can't see them doing that at all - for one thing that function in BBerg only works when the holders are required to disclose their holdings and bberg picks that up from the various gov't websites. Talcot's idea sounds like it would be a place for the end investors to go and volunteer that they hold the bonds rather than having to disclose their holdlings for regulatory issues in hopes that they can combine their forces and sue the shit out of the banks.
I guess I worded that poorly. My point was the same as yours - the vast majority of investors are easily viewable via eMaxx or Bloomberg (at least any investor who has to file a 13F, Schedule D, N30D, etc.). The investor base is overwhelmingly institutional - if they're publicly held, or if they're required to publicly report (Mutual Fund, Insurance Company, etc), then they're in there.
I get that Talcott is perhaps adding to the population of data at the fringes, but to state there was previously "no way of knowing who other investors are" is not a fair representation of the truth. Further, the point he repeatedly makes when being interviewed is that investors need to band together. Well, if Aunt Sally has 20 bonds and she's looking for other owners to join her merry band - does she go Talcott for the other "Aunt Sallys" of the world, or does she go to eMaxx and find out Pimco owns the other 900,000 bonds on that tranche?
My hat is off to him for coming up with a good marketing scheme to build out his client base though.
That's fair, but if Aunt Salley doesn't have access to or run a terminal it might be a place for her to go and find out which big firms are controlling the collateral ect.
Anyways I don't see how he'd convince large funds that aren't required to disclose their positions (PE funds ect) to do so.
I agree that it likely boils down to a marketing ploy
That's fair, but if Aunt Salley doesn't have access to or run a terminal it might be a place for her to go and find out which big firms are controlling the collateral ect.
Anyways I don't see how he'd convince large funds that aren't required to disclose their positions (PE funds ect) to do so.
I agree that it likely boils down to a marketing ploy
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