Howard Hughes's 1966 sale of his controlling interest in Trans World Airlines for $566 million may not stand as the greatest exit in capitalism. A strong and rising contender for that honor is the 2006 sale of Golden West Financial to Wachovia for $25.5 billion. One important part of the success of Golden West management was innovation. It was the team of Herbert and Marion Sandler that helped to develop the negatively amortizing mortgage.
It's an iron law of financial innovation that every good idea is driven into the ground like a tomato stake. So it has gone with the neg-am mortgage.
~ Jim Grant, "Limits of Leverage," Grant's Interest Rate Observer, April 4, 2008
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