Together with Stephen Joseph, the brother of Drexel Burnham’s CEO, Fred Joseph, he created the first private issue of mortgage securities. They persuaded the Bank of America to sell the home loans it had made – in the form of bonds. They persuaded investors, such as insurance companies, to buy the new mortgage bonds. When they did, the Bank of America received the cash it had originally lent the homeowners, which it could then relend. The homeowner continued to write his mortgage payment cheques to the Bank of America, but the money was passed on to the Salomon Brothers’ clients who had
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