We'll borrow some money on the house.

We'll use the house as collateral so we can borrow some money.

And then this guy has more to give. so it raises supply.

Whoever heard of anything happening to a bridge?

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Leverage.

I was the recipient of a large settlement.

We hold the bond on Jessup Dolly, and now he's a runner, it looks like.

You call them stock, or stock options, derivatives, mortgage backed securities.

So these shares each of these one million shares this is a mortgage backed security.

But what's been happening now is when banks use this money to borrow from the Fed or to borrow any money, they used these assets as collateral, they just sit tight on that cash.

If you have to rent a car, find a place that will take a cash deposit.

Central Europe, unsecured.

And the bank thinks it got a great deal.

And you end up with a mortgage backed security.

Hey, guys. Who's tripping down

And I'll teach you more about working capital.

But on a cash basis it looks like it was your best catering month ever

So just in kind of our everyday personal finance world, your mortgage is actually secured debt.

Was it a correct decision?

I put money in a safe.

I put the money into the safe.

What we are going to do is go buy things like highly rated mortgage backed securities, or things like commercial paper, AAA corporate debt, so that those things, the interest on those things goes down.

I have a whole video on mortgage backed securities.

What the Fed was doing was, they were saying, OK, we'll take some of these assets that Bank C has.

I'm not so sure you want the maintenance and safety department. The fire department might be a better bet.

So this little thing that I just created here, this little reconciliation between the positive 200 in income and the negative 200 of cash, it's showing how we got from this starting point in cash to this ending point.

This is highly rated mortgage backed securities, maybe they have a slightly higher interest rate.

Someone stole my cash.

It even includes the cash needed to operate the business.

Loan A for, I don't know, 10 billion dollars

They were constantly short of cash.

A cash injection in the tens of millions of dollars would relieve the entire Caribbean.

A 5year old bank account opened with cash.

Yeah. Put the coins in and pour the rice into the machine.

We had 1 billion before, so now we had 4 billion.

So that's what we're going to show you in the presentation on collateralized debt obligations.

Not many, because I bailed you out.

Why'd you pay my bail?

We would create incentives for securitization.

I have 4 billion in residential CDOs, collateralized debt obligations.

I guess you could say non cash assets, right?

Save from this time index.

But the bank says, no, you either sell your house or we're going to foreclo You either pay us for the debt, or we're going to foreclose on you.

The insurance?