Patrick Brown (MU ’04) and Timothy Fotsch (MU AIM ’07) were guests in Dr. Krause’s Fixed Income class on Friday. This is the seventh and fifth years, respectively, that these two Marquette alumni have visited Krause’s fixed income class. Mike Carlson (MU AIM '08) also spent time with the AIM students in class on Friday.
They addressed the students on the topic of mortgage-backed securities. Dr. Krause said, “Imagine the changes that have taken place since 2005 in the MBS market. While Pat and Tim are young, they are actually highly experienced in the world of structured financial markets and have experienced two major financial crises. 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 are excellent in the classroom and the students appreciate their ability to explain difficult topics clearly.”
Pat Brown, CFA, is a Senior Vice President, Institutional Client Group (ICG) - Fixed Income, Citigroup Global Markets. He is located in Citi’s Milwaukee office. Pat is nearing the completion of his Masters of Science in Applied Economics at Marquette University. Tim Fotsch is an Associate Analyst in Investment Grade – Fixed Income Securities, Wells Capital Management. Tim has passed all three levels of the CFA exams and has recently received his CFA charter – he works in Menomonee Falls, Wisconsin.
This year, Pat and Tim focused on the analysis of mortgage-backed securities. They also talked about the European financial crisis, various U.S. Government programs, and the recent actions of the Federal Reserve Board. Pat and Tim emphasized that understanding what policymakers in government are doing is essential. They clearly stated that it is essential for 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. They emphasized that it is vital to follow the actions of the Fed, Treasury, and other central banks.
They spent the first half of the classroom time reviewing the agency MBS sector from their unique perspectives. They showed Bloomberg screens and discussed and illustrated some of the finer points. Dr. Krause said, “This is difficult subject matter to teach – Pat and Tim 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.”
Mike Carlson (AIM ’07) of Cascade Investment* joined Tim and Pat to address the students in the Class of 2012 in the AIM Room. They continued talking about trends in the fixed income market. Dr. Krause added, “All of the guests talked about their experiences during the recent European financial crisis. I know the students enjoyed the stories about the issues they faced 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 and summer of 2011. It was great to have these three Marquette alumni join us again."
* Cascade Investment LLC is a private investment and holding company, incorporated in United States. It is controlled by Bill Gates and is headquartered in the city of Kirkland, Washington.