Friday, November 19, 2010

Pat Brown and Tim Fotsch Visited Dr. Krause's Classes on Friday, November 19th

Patrick Brown (MU ’04) and Timothy Fotsch (MU AIM ’07) have geen guests in Dr. Krause’s Fixed Income class for the past six and four years, respectively. They have addressed the students on the topic of mortgage and asset backed securities - and other structured products. Dr. Krause said, “Imagine the changes that have taken place since 2005 in the MBS and ABS market. While these are two young men, they are actually highly experienced in the world of structured financial markets. Their exposure to the world of RMBS, CMBS, ABS, repos, CDS, CDO, CMO, and interest rate derivatives is extensive. We are very fortunate to have these two capable alumni visit us each year. They really know their stuff.”

Pat Brown, CFA, is a Senior Vice President, Institutional Client Group (ICG) - Fixed Income, Citigroup Global Markets. He is located in the Milwaukee office. Pat is currently working towards his Masters of Science in Applied Economics at Marquette University. Tim Fotsch is an Associate Analyst in Investment Grade – Fixed Income, Wells Capital Management. Tim has passed all three levels of the CFA exams and will soon be receiving his CFA charter – he works in Menomonee Falls.

This year, Pat and Tim focused on optionality, the various U.S. Government programs, and the recent actions of the Federal Reserve Board. Pat said, “Understanding what the government is doing --- that is really what the analysis of structured finance has come down to recently. It is essential for the students to know more than just the ‘nuts and bolts’ basics of structured finance; it is now necessary for them to understand how this space actually trades and how analysts function. It is also very important to follow the actions of the Fed and Treasury.”

They spent the first half of the classroom time reviewing the agency MBS sector from their unique perspectives. They then showed Bloomberg screens to discuss and illustrate some of the finer points and to help bring the concepts to life. Dr. Krause said, “This is difficult subject matter to teach; they again did an excellent job helping the students with the concepts and applications – without burying them in the terminology. They did an outstanding job and were adept at moving between concepts and application. It is obvious why they are invited back each year to help me cover this material.”

"Tim and Pat also spent a full hour in the AIM Room with the students in the Class of 2011 talking in detail about the world of structured finance," Dr. Krause added. "They had some incredible experiences during the fall of 2008 - it was amazing to hear from them how difficult it was to buy and sell fixed income securities during the height of the financial panic. The students enjoyed the free flowing dialogue - it was an interesting discussion which provided the students with real color on what it was like on the trading desks in October 2008."

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