Maiden Lane lll

Discussion in 'Wall St. News' started by texrex2002, Mar 16, 2009.

  1. Does anyone have further details on this?

    According to Earth Times :

    On November 10, 2008, AIG and the FRBNY established Maiden Lane III, a financing entity, to purchase the securities underlying certain CDS contracts from the counterparties to such contracts, allowing the cancellation of the contracts. Attachment B lists payments made by Maiden Lane III to such counterparties.

    So it looks like it's a special investment vehicle to buy CDO's that AIG wrote CDS's on, alleviating the underwriting stress on AIG of them.

    My question is: are they being bought at face value, or at current market???? I'd think the CDO's can decline significantly in value without triggering a "credit event" that would allow a claim on the CDS??

  2. Per AP:

    "The money went to banks to cover their losses on complex mortgage investments, as well as for collateral needed for other transactions."

    sounds more and more like a euro bank bailout. Initially I thought it was all margin collateral, but I am beginning to doubt it...
  3. Maiden Lane I, II, & III are all underwater. Read the Federal Reserve Balance Sheet.
  4. 'Maiden Lane' sounds very ominous.
  5. probably named after Maiden Lane, a street down in the financial district here in NYC
  6. ha nevermind just realized that the Fed Reserve is on that street forgot.
  7. Elm Street would have been a better name. As in "Nightmare on Elm Street"
  8. Thanks. I didn't know that or that Bernanke's crew hung out on Maiden Lane.
  9. BiLoSellHi = inks2002??
  10. lol ..i live on Maiden Lane .. and yep ..i look right at that fed bldg ..
    #10     Mar 16, 2009