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The Credit Crunch, as told by Dr. Suess

Friday, December 28, 2007 | 03:00 PM

The following has ben pinging round the inter-tubes for weeks . . . The author is Cameron Crise of Fortis Investments in London:

>>>

Broker Joe!

Show me some flow

I need the dough!

I’m Broker Joe!

>>>

That Broker Joe!

I do not like

That Broker Joe!

>>>

Would you buy my CDO?
>>>

I do not like them, Broker Joe
I do not like your CDO!

>>>
Would you like it here or there?
>>>>>>
I would not like it here or there
I would not like it anywhere
I do not like your CDO
I do not like it, Broker Joe
>>>>>>

>>>

Would you like to sell some yen?
>>>
I do not want to sell the yen
The big fat tail just kills my zen

If you don’t sell now, then when?

I will not sell it here or there
I will not sell it anywhere
I do not like your CDO
I do not like it, Broker Joe

>>>
Our SIV has had a few rough knocks
>>>
Get in now, you sly old fox!

>>>

I am slyer than a fox
And I don’t think you have the docs
That you must have if you foreclose
And so a judge will thumb his nose
At you, your SIV, and CDO

>>>

Who owns the mortgage?
I don’t know
And you don’t either, Broker Joe

>>>
I would not know it here or there
I would not know it anywhere
I will not buy your CDO
I will not buy it, Broker Joe!

>>>

We have some hedge funds who are long
>>>
Those guys are smart! They can’t be wrong!

>>>

Some funds are long and some are not
The ones who are, are feeling caught
The short ones make a lot of sense
And they are up lots of percents
No SIV, no yen

>>>

Not now, not then
Not here, not there
I would not touch it anywhere
I will not buy your CDO
I will not buy it, Broker Joe!

>>>

But you can trust the agencies
>>>
They’ve rated this stuff Triple-B!
>>>
This tranche is still investment grade
>>>
You buy it here, your year is made!
>>>

The agencies have been asleep
Their ratings are just like ‘Bo Peep
That is, they’re from a fairy tale
As fiction goes, they’re off the scale

>>>

And I do not believe them, Joe
And so your tranche is a no-go
You think at 50 it’s a do
Until it falls to twenty-two

I do not like your CDO,
I will not buy it, Broker Joe!

>>>

>>>
Have you met our in-house quant?
>>>
He’ll model anything you want!

>>>

Except, that is, transactions costs
No thanks, I do not want the loss
From any quant’s sexy black box
Or mortgages unbacked by docs
Or mindless buys of kiwi-yen
Or ABX headed to 10
Or any other credit turd

>>>

I’ve spoken, Joe, so hear the word
I do not like your CDO,
I will not buy it, Broker Joe!

>>>

>>>
What?
>>>
What must I do, What must I do
>>>
What must I do to trade with you?

>>>

>>>
Perhaps you should avoid the drink
And use your brain sometimes to think
And not assume what’s gone before
Will follow on, and thus ignore
That circumstances sometimes change
And things that once seemed awfully strange
Can swiftly become commonplace
And then vanish once more, sans trace.
In short, you’ll have to look ahead
To win your future daily bread
In your head you have two eyes,
Use them, please, to analyze
And then you’ll see your business grow
So THINK THINK THINK THINK, Broker Joe!

>>>

I see! I see! I start to think
>>>
That all of my ideas stink
>>>
That CDO is mark-to-myth
>>>
The model’s written by a Sith
>>>
I’ll call my custies on the phone
>>>
And say “hey leave the yen alone!”
>>>
I’ll leave it to the black-box nerds
>>>
To buy up all the subprime turds!
>>>
I’ll say “you’re welcome”, “thanks”, and “please”
>>>
And just ignore the agencies
>>>
And as for our beleaguered SIV
>>>
The guy who runs it is a spiv
>>>
I’d stay away if I were youYes, that’s the wisest thing to do!
>>>
It’s been a quite eventful year
>>>
Weak hands have been found out, I fear
>>>
At bonus time they’ll feel the pinch
>>>
And find they’re working for the Grinch
>>>
(that begs the question: which is worse?
>>>
That bonus cheque, or all this verse?)