Nowadays he supplies oysters to some of the best restaurants in Manhattan. But in his previous incarnation, Mr Osinski played a crucial, if inadvertent, role in stirring up the financial whirlwind that has battered the world. As the top computer programmer for the titans of Wall Street, he wrote the complex software that bundled home mortgages into bonds, making possible the subprime loans collapse that sparked the global meltdown. [1]
It’s official, truth really is stranger than fiction. And meanwhile the WSJ is confirming that this is indeed what destroyed the planet.[2]
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[1]: "Creator of subprime monster ‘dismayed’", Telegraph / Sydney Morning Herald, March 9, 2009.
[2]: "From Bubble to Depression? Why the housing crash ruined the financial system but the dot-com collapse did no", by Steven Gjerstad and Vernon L. Smith, Wall Street Journal, April 5, 2009.
The price decline started in 2006. Then policies designed to promote the American dream instead produced a nightmare. Trillions of dollars of mortgages, written to buyers with slender equity, started a wave of delinquencies and defaults. Borrowers’ losses were limited to their small down payments; hence, the lion’s share of the losses was transmitted into the financial system and it collapsed.
