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...Building the securities which were sold as mortgage-backed financial products was complex. Financial firms had to buy large pools of existing mortgages and develop mathematical models for the cash flows they would produce well into the future as homeowners made their monthly payments. These pools were cut into tranches with each tranche carrying a probability of how many mortgages in it would pay out to maturity and how many would fail. After these calculations were made, they were sold to banks, brokerage firms, and other financial institutions as high-yield paper. The major credit agencies gave these securities...

Author: /time Magazine | Title: Finding the Man Who Started the Global Recession | 2/2/2009 | See Source »

...firms leading the charge to capital-light banking was Bank of America (BofA). Starting in 1993, a predecessor firm became one of the first banks to develop and embrace computer models that were supposed to improve a bank's ability to determine the risk of a particular type of loan. After a merger in 1998 that formed the bank, BofA officials often argued to investors and regulators that these new advanced risk controls meant the bank needed to carry less capital per loan. The officials also frequently fought regulations that would boost capital requirements for them and other banks...

Author: /time Magazine | Title: Why Your Bank Is Broke | 1/31/2009 | See Source »

...health care spending, arguing in his most recent book, “Your Money or Your Life: Strong Medicine for America’s Health Care System,” that such spending has been worthwhile despite its high costs. “He had a strong voice in developing President Obama’s health policy ideas, so I am expecting [the policy he implements] will continue down the general lines President Obama outlined,” said Richard G. Frank, a professor of health care policy at Harvard. Asked about transitioning from academia to a government position, Cutler...

Author: By Noah S. Rayman and Elyssa A. L. Spitzer, CRIMSON STAFF WRITERSS | Title: Cutler To Serve Obama In D.C. | 1/30/2009 | See Source »

Before that can happen, however, Melton wants to learn more about how diseases develop. And iPS cells make that possible too. For the very first time, he can watch Type 1 diabetes unfold in a petri dish as a patient's cells develop from their embryonic state into mature pancreatic cells. The same will be true for other diseases as well. "There is a good reason we don't have treatments for diseases like Parkinson's," says Melton. "That's because the only way science can study them is to wait until a patient appears in the office with symptoms...

Author: /time Magazine | Title: Stem-Cell Research: The Quest Resumes | 1/29/2009 | See Source »

...open the door to future stem-cell therapies. "I think this is a very positive start, but the expectations and hype I see around stem-cell therapies are the same that I saw around gene therapy. We just have to remember that these take a long time to develop. But you will never know if they work unless you study them in humans, so this is an important first step...

Author: /time Magazine | Title: Cautious Optimism for the First Stem-Cell Human Trial | 1/24/2009 | See Source »

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