DOYLC

In my previous post I noted the example of the definition of “Mortgage-Backed Securities” in Prof. Campbell Harvey’s Hypertextual Finance Glossary.   The definition is: Securities backed by a pool of mortgage loans   [http://www.duke.edu/~charvey/Classes/wpg/glossary.htm] The term “pool” is hyperlinked in this definition, and the definition of “pool” is: In capital budgeting, the concept that investment projects are financed out of a pool of bonds, preferred stock, and common stock, and a weighted-average cost of capital must be used to calculate investment returns. In insurance, a group of insurers who share premiums and losses in order to spread risk. In investments, the combination of funds for the benefit of a common project, or a group of investors who use their combined influence to manipulate prices. This definition of “pool” does not fit the use of the term “pool” as it appears in the definition of “ Mortgage-Backed Securities”.   I would argue that “pool” in thi...