section_path: Career/Liquid Funding Ltd.
section_name: Liquid Funding Ltd.
paragraph_text: Liquid Funding Ltd.
  
  Epstein was the president of the company Liquid Funding Ltd. between 2000 and 2007. The company was an early pioneer in expanding the kind of debt that could be accepted on repurchase, or the repo market, which involves a lender giving money to a borrower in exchange for securities that the borrower then agrees to buy back at an agreed-upon later time and price. The innovation of Liquid Funding, and other early companies, was that instead of having stocks and bonds as the underlying securities, it had commercial mortgages and investment-grade residential mortgages bundled into complex securities as the underlying security.
  
  Liquid Funding was initially 40 percent owned by Bear Stearns. Through the help of the credit rating agencies — Standard & Poor's, Fitch Ratings and Moody's Investors Service —the new bundled securities were able to be created for companies so that they got a gold-plated AAA rating. The implosion of such complex securities, because of their inaccurate ratings, led to the collapse of Bear Stearns in March 2008 and set in motion the 2008 financial crisis and the subsequent Great Recession. If Liquid Funding were left holding large amounts of such securities as collateral, it could have lost large amounts of money.
  
  Epstein was the president of the company Liquid Funding Ltd. between 2000 and 2007. The company was an early pioneer in expanding the kind of debt that could be accepted on repurchase, or the repo market, which involves a lender giving money to a borrower in exchange for securities that the borrower then agrees to buy back at an agreed-upon later time and price. The innovation of Liquid Funding, and other early companies, was that instead of having stocks and bonds as the underlying securities, it had commercial mortgages and investment-grade residential mortgages bundled into complex securities as the underlying security.
  
  Liquid Funding was initially 40 percent owned by Bear Stearns. Through the help of the credit rating agencies — Standard & Poor's, Fitch Ratings and Moody's Investors Service —the new bundled securities were able to be created for companies so that they got a gold-plated AAA rating. The implosion of such complex securities, because of their inaccurate ratings, led to the collapse of Bear Stearns in March 2008 and set in motion the 2008 financial crisis and the subsequent Great Recession. If Liquid Funding were left holding large amounts of such securities as collateral, it could have lost large amounts of money.