The Orange County, California, Bankruptcy
Lecture no. 66 from the course: Crashes and Crises: Lessons from a History of Financial Disasters
Taught by Professor Connel Fullenkamp | 07 min | Categories: The Great Courses Plus Online Economics & Finance Courses
Discover how an elected official with a self-admitted seventh-grade proficiency in math earned fabulous returns as treasurer of Orange County, California, and then plunged the system into the largest municipal default in United States history up to that time. His strategy—and downfall—relied on two financial instruments: repurchase agreements and inverse floater bonds. Track down where he went wrong.