<html><head></head><body><div style="color:#000; background-color:#fff; font-family:HelveticaNeue, Helvetica Neue, Helvetica, Arial, Lucida Grande, sans-serif;font-size:13px"><div id="yui_3_16_0_ym19_1_1471369057614_3648" dir="ltr"><a href="https://www.bloomberg.com/view/articles/2016-08-16/hedge-fund-manager-profited-from-death-arbitrage" class="" id="yui_3_16_0_ym19_1_1471369057614_3696">https://www.bloomberg.com/view/articles/2016-08-16/hedge-fund-manager-profited-from-death-arbitrage</a><br></div><div id="yui_3_16_0_ym19_1_1471369057614_3648" dir="ltr"><br></div><div id="yui_3_16_0_ym19_1_1471369057614_3648" dir="ltr">"<span style="color: rgb(51, 51, 64); font-family: Tiempos, "Helvetica Neue", Helvetica, Arial, sans-serif; font-size: 17px; line-height: 1.6em;" id="yui_3_16_0_ym19_1_1471369057614_3807">A vital function of the financial system is to shift risk, but that is mostly a euphemism. Finance can't make risks go away, or even really move them all that much. When the financial system shifts the risk of X happening from Y to Z, all that means is that Z gives Y money if X happens. If X was going to happen to Y, it's still going to happen to Y. But now Y gets money. </span></div><div style="box-sizing: border-box; line-height: 1.6em; margin-bottom: 1.25em; color: rgb(51, 51, 64); font-family: Tiempos, "Helvetica Neue", Helvetica, Arial, sans-serif; font-size: 17px;" id="yui_3_16_0_ym19_1_1471369057614_3808">Death is a central fact of human existence, the <a href="http://www.npr.org/programs/death/readings/stories/bart2.html" data-web-url="http://www.npr.org/programs/death/readings/stories/bart2.html" style="box-sizing: border-box; color: rgb(0, 185, 231); text-decoration: none;" id="yui_3_16_0_ym19_1_1471369057614_3809">fundamental datum that gives meaning to life</a>, but it is also a risk -- you never know when it will happen! -- and so the financial industry has figured out ways to shift it. Not in any supernatural sense, I mean, but in the regular financial-industry sense: by giving people money when death happens to them. One cannot know for certain how much of a consolation that is."</div><div style="box-sizing: border-box; line-height: 1.6em; margin-bottom: 1.25em; color: rgb(51, 51, 64); font-family: Tiempos, "Helvetica Neue", Helvetica, Arial, sans-serif; font-size: 17px;" id="yui_3_16_0_ym19_1_1471369057614_3810">"Another vital function of the financial system is to brutally punish the mispricing of risk through arbitrage. Actually I don't really know how vital that one is, but people are pretty into it. If someone under- or overestimates a risk, someone else will find a way to make them pay for it. That's how markets, even the market for death, stay efficient."</div><div style="box-sizing: border-box; line-height: 1.6em; margin-bottom: 1.25em; color: rgb(51, 51, 64); font-family: Tiempos, "Helvetica Neue", Helvetica, Arial, sans-serif; font-size: 17px;" dir="ltr" id="yui_3_16_0_ym19_1_1471369057614_3811">"The normal way to shift the risk of death is life insurance -- you die, the insurance company gives you money -- but there are other, more esoteric versions, and they are more susceptible to arbitrage.<a href="https://www.sec.gov/litigation/admin/2016/33-10120.pdf" data-web-url="https://www.sec.gov/litigation/admin/2016/33-10120.pdf" style="box-sizing: border-box; color: rgb(0, 185, 231); text-decoration: none;" id="yui_3_16_0_ym19_1_1471369057614_3812">One version</a> involves "medium and long-term bonds and certificates of deposit ('CDs') that contain 'survivor options' or 'death puts.'" Schematically, the idea is that a financial institution issues a bond that pays back $100 when it matures in 2040 or whatever. But if the buyer of the bond dies, he gets his $100 back immediately, instead of having to wait until 2040. He's still dead, though."</div><div style="box-sizing: border-box; line-height: 1.6em; margin-bottom: 1.25em; color: rgb(51, 51, 64); font-family: Tiempos, "Helvetica Neue", Helvetica, Arial, sans-serif; font-size: 17px;" dir="ltr" id="yui_3_16_0_ym19_1_1471369057614_3811">[end of partial quote]</div><div style="box-sizing: border-box; line-height: 1.6em; margin-bottom: 1.25em; color: rgb(51, 51, 64); font-family: Tiempos, "Helvetica Neue", Helvetica, Arial, sans-serif; font-size: 17px;" dir="ltr" id="yui_3_16_0_ym19_1_1471369057614_3811"><br></div><div style="box-sizing: border-box; line-height: 1.6em; margin-bottom: 1.25em; color: rgb(51, 51, 64); font-family: Tiempos, "Helvetica Neue", Helvetica, Arial, sans-serif; font-size: 17px;" dir="ltr" id="yui_3_16_0_ym19_1_1471369057614_3811">AP ('Assassination Politics'; <a href="https://cryptome.org/ap.htm" class="" id="yui_3_16_0_ym19_1_1471369057614_4021">https://cryptome.org/ap.htm</a> ) can be considered to be 'death arbitrage' with a few key differences: The person who will die isn't part of the agreement, and doesn't profit when the initial deal is struck, nor later. </div><div style="box-sizing: border-box; line-height: 1.6em; margin-bottom: 1.25em; color: rgb(51, 51, 64); font-family: Tiempos, "Helvetica Neue", Helvetica, Arial, sans-serif; font-size: 17px;" dir="ltr" id="yui_3_16_0_ym19_1_1471369057614_3811"> Jim Bell</div><div id="yui_3_16_0_ym19_1_1471369057614_4061"><br></div><div id="yui_3_16_0_ym19_1_1471369057614_4062"><br></div><div id="yui_3_16_0_ym19_1_1471369057614_3738"><br></div><div id="yui_3_16_0_ym19_1_1471369057614_3760"><br></div></div></body></html>