Series 17 | Part 2: Wall Street May Create Another Bubble, this time with Healthcare

Remember, it doesn’t matter when they want to make a box of mortgage payments or medical bill payments and sell that box for pennies on the dollar to a large investment bank. A hospital might not want the risk of writing off so many medical bill receivables three years from now when they could get $0.50 per dollar for low-risk pools of patients who owe money and $0.20 per dollar for high-risk pools of patients that are never going to pay anyway. For the high-risk patients, the hospital might as well collect their money now while there’s a buyer.

Basically, instead of CDO’s or credit default swaps that offer protection for banks or the investors to whom the banks sell these swaps against people not paying their mortgages or for even prepaying, now they want to replace those mortgages with real people! NOW, WE’RE THE BONDS!

See, the hospitals are run by corporations now, which means they need to get their earnings per share as high as possible. That means they can’t have a loss on their income statement. Those write-offs of medical bills unpaid will go on their income statement. The accounting rule is you have to take unpaid receivables off your books–the rule further states this must be entered as an expense–after a certain period of time. Therefore, the hospitals now, not the banks anymore, will be selling these receivables to investors.

This is where is gets interesting. We’re playing with people’s lives. Before, they could be kicked out of their homes, but if homelessness made them sick, they could go to the hospital. Now, we’re playing with their lives, and that means anyone interested in killing someone can play with this market to ensure that a healthcare bubble occurs and then bursts, killing people. Many people have their homes back so they’ll die at home or die in some home they moved to after losing the home they shouldn’t have had to lose in the first place, but those who want to do harm to us will be able to use these investment markets to more directly kill people. Of course, if they die, they can’t pay their mortgage, and then the house gets sold to someone who can pay for it, like perhaps an overseas investor from one of the countries–one of the few, but those bad actors are definitely out there–that wants to do us harm.

Let’s say a Chinese investor, working for the Chinese government, invests in these markets and then tries to tank the markets. George Soros tanked a market. Why can’t an army of people do the same thing, especially when they’re given the order to do so by their superiors in a country that is known for being able to control everyone’s every move? Of course they can do that. That’s the mean. They, of course, have the motive. They don’t like us. And with these investments, there’s the opportunity. The bridge over the Pacific to come invade the West is suddenly just a few lines of computer code.

The Chinese investor, or an investor from another country, can pay a huge premium for even the high-risk pools of patients that will never pay so that they can encourage all the hospitals to get into these investments, selling all their receivables to the investors. Not all of them will be Chinese or otherwise foreign. Wall Street and hedge funds and others will be doing this, as well. However, at this point, everyone will be involved.

Then, we go to the ratings agencies.

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