After the mortgage business imploded last year, Wall Street investment banks began searching for another big idea to make money. They think they may have found one.
The bankers plan to buy “life settlements,” life insurance policies that ill and elderly people sell for cash — $400,000 for a $1 million policy, say, depending on the life expectancy of the insured person. Then they plan to “securitize” these policies, in Wall Street jargon, by packaging hundreds or thousands together into bonds. They will then resell those bonds to investors, like big pension funds, who will receive the payouts when people with the insurance die.
The earlier the policyholder dies, the bigger the return — though if people live longer than expected, investors could get poor returns or even lose money.
Either way, Wall Street would profit by pocketing sizable fees for creating the bonds, reselling them and subsequently trading them. But some who have studied life settlements warn that insurers might have to raise premiums in the short term if they end up having to pay out more death claims than they had anticipated.
Seems pretty shady to me, just the kind of ‘clever-assed’ thinking that got us into the current crisis. Somebody ought to get these guys real jobs.
This is the WORST Republican health insurance reform plan yet proposed yet.
“Aren’t most investment bankers Republicans?”
They are overwhelmingly Democrats.
It was really popular a few years ago when I would receive calls from my bank card companies asking me if I wanted to sign up for a free $50,000 life insurance policy, gratis for being a card member. Of course the real policy is for $250,000 of which your beneficiary gets $50,000 and the bank pockets $200,000.
There is a good story about Jeanne Calment, the oldest living person in the world at the time of her death. At the age of 90 she signed a reverse mortgage with a 47 year old lawyer. The lawyer died at the age of 77, one year before Mrs. Calment. When asked about the circumstance she replied, “In life, one sometimes makes bad deals.”
Uncle Dave and Dallas get pwnd again by Minatti. You fellows and your insistent party loyalty are what the real problem is with America.
Lets be clear here boys, and your way of thinking is boyish immaturity, BOTH PARTIES are at fault. BOTH PARTIES are one big same thing.
Washington D.C needs to be severely reigned in, term limits instituted, and power of taxation and public policy returned to the states. Most Americans live in their state not in D.C, return them their constitutional right of self governance and end these train wreck out of control career politicians that are stealing your future.
I remember hearing about a woman in france who had one of these policy’s. She took it out in her mid 80’s. The deal was she had all her nursing home care paid for. In return the investor got all her assets upon her death. She lived to be 109, I think it was, and the investor went broke.
Greed is the foundation of capitalism. How do you expect it work without it?
Cash register tapes are worth more than gold to these investment bankers.
Next time you use that savings card at the grocery store, you might ask yourself “what are they going to do with all that data they collect on every single item I buy?”
God bless america, assuming we survive it.
Uncle Dave snarks: Oh, wait. Aren’t most investment bankers Republicans?
Oh, wait. Aren’t most investment banker regulators in Congress Democrats?
Seems to me the Repuglicans vote is IN THE BAG and will vote for any Investment Bubble that comes their way. The Dem’s need convincing/bribing/hush money, so they get the lions share.
Who’s to say what it means “except:”
VOTE ALL INCUMBENTS OUT OF OFFICE.
#4 Fox in the henhouse? In the US all henhouses come with the fox included. And the little bastard’s smarter than Bugs Bunny. I’d say it’s time to get the hell out of the chicken business. Oh and what’s with this either/or business. I mean if you don’t like plan A or B, think up a plan C, right? There’s plenty of alternatives. Everyone should have a RIGHT to basic life support, but that doesn’t mean the government should pay for your ingrown toenail or even for the pediatrics for your pregnant wife (with some exceptions). What makes socialized medicine inefficient is the way people show up at the hospital emergency room with a head cold. So put some limits.
#15,
I really wish some one would come up with a way for us to buy a buffet of options. Start with something simple like catastrophic coverage. Then you add things on and pay extra for things like wellness coverage and mental health care. Pediatric and natal care would have their own plan.
Also if you look where the really huge cost center is, that last year of cancer treatment, just let us take the option to buy coverage that only grants hospice care, but does not include that end of life cancer coverage.
Once again, our health care system is buckling under the tyranny of old people with cancer care. Dude, you have pancreatic cancer, you are gonna die. Why should the rest of us have to pay so you get six extra months of crap life?
Something that is being lost from this debate is that Republicans are the ones arguing for wasteful unlimited end of life spending. Republicans are directly responsible for the health care crisis.
This describes this practice. The risk is mostly assumed by the investment banker/investor, but is risky. If the insured has not long to live, they can benefit from all that life insurance themselves prior to death. Beats being unemployable due to health concerns, and homeless. If you buy one of these as an individual, you can loose your shirt, however, if as previous posts state, the insured lasts longer than anticipated.
#12 When I filled out the form for my Safeway Discount card, I put in totally bogus information. The card works fine, and nobody knows who is buying all the stuff I purchase. Just in case you want to re-apply for a card using a fake name, address, and phone number.
Imagine an investment bank creating a virus that wipes out all of ‘life settlement’ sellers?
Maybe they could infect the paper the contract is printed on!
SHOW ME THE MONEY!!!
WOW!
Investment Bankers Betting On When Sick & Elderly Will Die
Investment bankers don’t need to create a virus that wipes out the elderly, their collapsed 401k investments and abject poverty will do that for them.
It’s a sure bet for Investment Bankers as long as republicans have any public office.
Just another example of how Wall Street is working hard to break the back of the American Spirit.
Once Wall Street has picked all the meat of the America carcass, where do they go from there.
All ready China and EU have a very healthy distrust of Wall Street.
No doubt about it, this will cause premiums to rise.
#17
Nonsense. The Democrats control both houses and the Presidency. All they need to do is get their own people on board and they’ll get something passed without the Republicans. The real question is why they cannot convince their own people.
#24–Thomas==is your reference to the mostly correct posting at #17 correct? You say nonsense and then make the opposite argument actually supporting what #17 said. Depends on what part of your post you think nonsense applies to?
Actually, most Bankers are Demoncrats as are most Lawyers and most of the rich. I’ve never seen a rich person give anything to the people without a hook, just like the Demoncrats.
All Demoncrats:
Rockefeller, Kennedys, Richard Dean Parsons (Chairman of Citigroup}, Lloyd Blankfein{Goldman Sachs},James L. “Jamie” Dimon{CEO at
JP Morgan Chase}, John J. Mack {CEO and Chairman of the Board of the investment bank Morgan Stanley).
Find a Demoncrat elite and you’ll find a rich person.
pfffhhhhh, there you go again Uncle Dave, was it not the republicans in the audiences that brought up death panels???
Or are you trying to have it both ways while stirring the pot??
Please tell me, I’m fascinated.
#28,
I’d like to take the Death Panel issue head on. Cold hard facts.
The private insurance you have now has some type of lifetime limit to it. Basically, when you get cancer, they will pay for about a year of chemotherapy, then they boot you off the plan, and it is then impossible for you to get on another insurance plan after that. So you go bankrupt then you end up on medicare (if you are old enough) or medicade (if you are poor enough) and they will only pay for hospice care at that point.
Same thing happens if you are a newborn with a chronic illness.
So the retardlicans can suck my big fat death panel.
Once again, Uncle Dave’s limited worldview (the Democratic party as a religion) runs face-first into reality (investment bankers are overwhelmingly Democrats). Oops. I’ll bet that doesn’t stop him from posting more drivel in the future, though.
# 28 so assuming you have a point other than the one on the top of your head ?8^) exactly how much do you want to pay to have someone tell you to go pick out a grave plot?
I’m not a big fan of the funeral business either. I told my guy that all I actually needed him to do was did the hole, put the body at the bottom and fill the hole back up. Ashes to Ashes and dust to dust. For some reason he didn’t seem happy about that.
#28: What are you talking about? Of course it was the Republicans. Having reading comprehension issues today?
#30: I’m so glad you’ve cleared that up for me. I didn’t realize that I was a Democrat, given I disagree with so many of their policies. It could be that given I disagree with so many of the Republican’s policies even more is what got you confused.
#32, Dave,
You should probably edit your post so that it’s more factual.
Unless you’d like to continue promoting partisan bullshit and also perpetuating the false left/right paradigm so many people appear to have adopted.
Big business loves big government. They are not opposed to each other. Rather they are two heads on the same coin. No matter which way you flip that coin you’re going to lose.
That said, both parties do receive significant campaign donations from big business. But why?
simple.
Both parties increase the size of government, and also pad the bottom line for big business. They are no different.
God Bless America.