Super SIV 101

How the SIV crisis erupted and why Wall Street firms are leading a rescue effort.

A safe way to turn a buck
A safe way to turn a buck
The first structured investment vehicle, or SIV, was created in 1988, and others quickly followed.

SIVs issued debt in the commercial paper market, a short-term financing market. Then they used the proceeds to buy higher-yielding, long-term assets, such as mortgage-backed securities.

The strategy worked as long as money market fund managers and others bought the commercial paper - which was generally considered a safe investment.


SIVs created

Red flag

Turmoil hits

Danger lurks

Superfund

Doubts grow
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Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.