Lebanon central bank chief got it right
An impressive story of how Lebanon's chief banking regulator - a former Merril Lynch investment banker - kept Lebanon's banks safe by forbidding trading in exotic derivatives, and aggressively shutting down banks which could not meet his stringent capital requirements.
This quote in particular (about mortgage-backed securities) should put western bankers to absolute shame, since it is so very obvious, yet went so unheeded:
Quote:
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"We could not really sense who would be responsible in the end to collect these loans," he said. "And we do not perceive banking as being a place to speculate on financial instruments that are not really concrete."
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