| |
BlackRock
Wears Multiple Hats (Excerpt)
Wall
Street Journal - May 19,
2009
by Liz
Rappaport
and Susanne Craig
"BlackRock
is too close to the problem to be
objective," says Janet Tavakoli,
a former Wall Street derivaitves
trader and now president of a financial-consulting
firm. "One should question how much
they are part of the problem."
JT Note: Blackrock
has not inspired me with confidence
given its track record both as an
investor in related securities and
as a CDO manager. How does Blackrock
Financial Management explain its
role as CDO manager in some horrific
2007 vintage CDOs such as Pacific
Pinnacle CDO ($1 billion; closed
1/1/07; EOD 2/4/08); Pinnacle Point
Funding ($2B closed 6/7/07; acceleration
12/13/07); Tenorite CDO I ($1 B closed
5/11/07; liquidation 2/7/08); or
Tourmaline CDO III ($1.5 billion
closed 4/5/07; EOD 3/31/08)? In my
opinion, Blackrock is too close to
the problem to be objective, and
no bid contracts were inappropriate.
[Disclosure: In some respects I am
a competitor of Blackrock in that
I could have assembled a valuation
team. I was not approached, however,
and I am not a government contractor.]
End
of Excerpt
Janet
Tavakoli is the president of Tavakoli Structured
Finance, a Chicago-based firm that provides consulting to financial
institutions
and institutional investors. Ms. Tavakoli has more than 20
years of experience in senior investment banking positions, trading,
structuring and marketing structured financial products. She
is a former adjunct professor of derivatives at the University
of Chicago's Graduate School of Business. She is the author
of:
Credit
Derivatives & Synthetic Structures (John
Wiley & Sons,
1998, 2001), Structured
Finance & Collateralized Debt
Obligations (John Wiley & Sons, 2008),
and
Dear
Mr. Buffett: What An Investor Learns 1,269 Miles From Wall
Street (John Wiley & Sons January
2009)
Clients
of Tavakoli Structured Finance
have the benefit of proprietary consultation, which is
not available in any other paid or public forum. Clients
also commission proprietary research and analysis.
TSF
makes some information available to the general public. Please
click here for other articles.
|
