I heard the “Death Bonds” story on the radio while driving to the Gubernatorial energy forum last night.
Frankly, I simply did not believe it.
Progressive Pacifica radio station NY CIty affiliate WBAI has a range of quality and credibility – from highly credible “Democracy Now! to some pretty far out stuff – so I sort of tuned it out and thought that this must be a joke – the left’s mocking rhetorical counter to the right wing Sarah Palin “Death Panels”
But as I listened, I heard the story sourced to the New York Times‘ business page.
So I checked it out and sure enough on September 5, 2009, the Times reported:
Wall Street Pursues Profit in Bundles of Life Insurance
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. [link to full article here]
Westfield, NJ
I thought about this story as I toured historic upscale downtown Westfield, NJ. A Church spires framed my walk.
I saw families out for dinner, and thought: How many of these wealthy mom’s and dad’s make a living selling Death Bonds?
Have we hit moral rock bottom yet? (link thrown in for market fundamentalists who would subject all of human society to the nihilism of property, contract, and exchange value)
This is NOT the “Change” I voted for.
If Obama’s financial wizards can’t find a regulatory basis to ban this practice, stop the world. Let me off. I want out of this insane asylum.
(note: Huffington Post wrote about the issue here)