(Reuters) - Hedge funds that had sold short such securities made
profits when an index tied to a basket of subprime bonds was
falling. But the index has recovered in recent weeks, leading
to howls of protest from hedge funds, according to the report.
The chief critic, John Paulson of Paulson & Co., a $12
billion fund, says Bear Stearns wanted to prop up faltering
mortgages-backed securities by purchasing individual mortgages
that were rapidly losing value to avoid doling out billions in
swap payments, the Journal reported.
Read more at Reuters.com Bonds News
profits when an index tied to a basket of subprime bonds was
falling. But the index has recovered in recent weeks, leading
to howls of protest from hedge funds, according to the report.
The chief critic, John Paulson of Paulson & Co., a $12
billion fund, says Bear Stearns wanted to prop up faltering
mortgages-backed securities by purchasing individual mortgages
that were rapidly losing value to avoid doling out billions in
swap payments, the Journal reported.
Read more at Reuters.com Bonds News
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