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Imagine for a minute that the Moon is held in its orbit about the Earth by electrical forces rather than by gravitation. What electrical charges −Q on the Earth and +Q on the Moon are necessary to hold the Moon in a circular orbit with a period of 27.3 days? The Earth-Moon distance is 384 000 km and the mass of the Moon is 7.35 × 1022 kg.
Asset Securitizations
The financial process of pooling various types of debt instruments (e.g., loans, bonds) and selling them as consolidated financial securities to investors.
Credit Derivatives
Financial instruments that allow parties to manage exposure to credit risk, through vehicles such as credit default swaps (CDS).
CDOs
Collateralized Debt Obligations are complex financial instruments that pool together various cash flow-generating assets and repackages this asset pool into discrete tranches that can be sold to investors.
Credit Crisis
A financial situation characterized by a severe shortage of credit or loans, often resulting in widespread financial and economic instability.
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