eLROY writes: *** But I would say the equilibrium way for this transaction to happen, given current technology, is for separate, liquid electronic marketplaces for disaggregated and building-block bets - for various strips in essence - to spring up.


That way, instead of structuring anything - or talking to anyone on the phone - you just enter into some kind of a "default swap" with an anonymous counterparty. ***


I think you overestimate the capabilities of the fixed income clients. Almost all of them have some ability to evaluate what is offered to them (amazingly some of them have none!), but for most, this ability is limited and not very precise (whence it is still possible to improve their investment performance over what they could accomplish without you despite charging them fairly large commissions). Many (most?) fixed income clients do not have the analytic ability to construct portfolios from commoditized building blocks. If you offered these to them, they would be very afraid of getting ripped off (and rightly so ... not because you're trying to, but because they couldn't tell the difference between a good deal and a sinkhole).


Note: I am not writing this to shoot down your ideas. I am very intrigued, but I'd like to understand them better.