BusinessWeek – Wall Street’s biggest firms are considering the suitability of selling opaque financial products to governments, endowments and not-for-profit institutions after the contracts magnified credit-market losses that plunged the U.S. into a recession.
“There is no distinction among very different groups of investors, and this is where things might change,” said Dino Kos, a managing director at Portales Partners LLC in New York and former head of the Federal Reserve Bank of New York’s open market operations. “Wall Street cannot pretend anymore that the treasurer of a small town in the Midwest on a civil service salary and no analytical support has the same level of sophistication as a specialized hedge fund.”
