Goldman Executive Who Made Millions on Housing Bust Now Wants to Make Millions on Housing Un-Bust "Hedge Fund"Quicklink submitted by Amanda Lang Permalink
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|It's a shame Occupy Wall Street is no longer the force it used to be, because the movement could have had a field day with the story of Donald Mullen.
Mullen, a former Goldman Sachs mortgage executive who helped design the trades that allowed Goldman to profit from the collapse of the housing bubble, is raising money for a hedge fund that will buy up foreclosed homes and rent them out, Reuters reports.
Let's go over this a little more slowly, because it is actually sort of crazy:
In the years leading up to the financial crisis, a team of mortgage executives and traders at Goldman Sachs predicted that the housing market was in trouble. So they designed a massive bet against it, using a bunch of esoteric financial instruments known as collateralized debt obligations that would pay off in the event that housing prices fell and homeowners defaulted on their mortgages.
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