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Big Bets Gone Bad Derivatives and Bankruptcy in Orange County - The Largest Municipal Failure in U. S. History

ISBN-10: 0123903602

ISBN-13: 9780123903600

Edition: 1995

Authors: Philippe Jorion

List price: $57.95
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Description:

How can a municipal investment pool, which is supposed to be safe, lose billions of dollars? What are derivatives and how did they contribute to this tragedy? In December 1994, Orange County became the largest municipality in U.S. history to become bankrupt. By borrowing heavily and placing the wrong bets, Orange County Treasurer Robert Citron lost $1.7 billion of Orange County's $7.4 billion investment portfolio. Big Bets Gone Bad: Derivatives and Bankruptcy in Orange County is the first detailed description of the Orange County bankruptcy. Author Philippe Jorion, the only professor in Orange County who teaches and researches derivatives, is uniquely placed to understand the technical details of the portfolio and climate in the Orange County municipal government that encouraged the decisions that led to the bankruptcy. Big Bets Gone Bad provides an introduction to the U.S. bond market and details Federal Reserve Chairman Greenspan's efforts to tighten credit. Its description of the $35 trillion derivatives market makes the losses of Barings Bank, Kashima Oil, West Virginia, and Metallgesellschaft more understandable. Big Bets Gone Bad explains what everyone should know about tax monies and public investments. Because nobody likes to lose $1.7 billion.
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Book details

List price: $57.95
Copyright year: 1995
Publisher: Emerald Group Publishing Limited
Publication date: 9/18/1995
Binding: Paperback
Pages: 176
Size: 5.75" wide x 8.75" long x 0.75" tall
Weight: 0.594
Language: English

PHILIPPE JORION is Professor of Finance at the School of Business at the University of California at Irvine. He was also a professor at Columbia, Northwestern, the University of Chicago, and the University of British Columbia. He holds an MBA and a PhD from the University of Chicago and a degree in engineering from the University of Brussels. Dr. Jorion has authored more than a hundred publications-directed towards academics and practitioners-on the topic of risk management and international finance. His work has received several prizes for research. Dr. Jorion has written the first five editions of Financial Risk Manager Handbook (Wiley), as well as Financial Risk Management: Domestic and International Dimensions; Big Bets Gone Bad: Derivatives and Bankruptcy in Orange County; and Value at Risk: The New Benchmark for Managing Financial Risk. He is also a Managing Director in the Risk Management Group at Pacific Alternative Asset Management Company (PAAMCO), a global fund of hedge funds.

Introduction
Robert Citron and His World
Bond Basics
Repos
Damned Derivatives? Structured Notes
Rocket Scientists--It Gets Technical
The Need for Capital
Going Bankrupt
Citrons Strategy (the Repo Man)
Suing Wall Street
The Bondholders
Placing Blame
Fallout in the County
Lessons in Risk
Risk and Derivatives
Do We Need Regulation? Conclusions
Epilogue
Bibliography
Glossary of Financial Terms
Index