There is a problem in the legal profession to mirror the dysfunctionality in structured finance. So far lawyers have escaped the vitriol reserved for the current villains, the supposed predatory lenders and casual money mangers. But the fallout from the US subprime mortgage market has exposed the inadequacy of investor education and representation. Lawyers have a part to play, as buyers of complex collateralized debt obligations, derided as toxic in the financial press, do not understand the risks they are taking.
August 31 2007