Meet the Man Responsible for the Credti Crisis

David Bowie.

It may sound like a ridiculous question, but it’s not as mad as it seems. Even when it comes to finances Bowie leads the way – and back in 1997 he did something called ‘securitisation’.
He thought: ‘I have a lot of money coming in over the next ten years from my back catalogue, but I’d rather have the cash now and not have to wait.’
He produced some bits of paper – Bowie Bonds – and said: ‘Whoever buys these gets my royalties.’
It meant he no longer had the money coming in but instead had a lot up front. His investors were guaranteed a decent income. It was a good deal all round.
And the banks were catching on to the idea. They thought: ‘We have billions out there in mortgages which are going to pay us back very slowly. Why don’t we sell those and get the money now?’
So the banks started doing what Bowie had done – in a big way.

Personally, I blame Ziggie Stardust.

Posted by on January 14th, 2009 at 3:11 pm


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