1. 21 April 2009 Media Contact
EFG-US-20090421-1 Jeff Mustard
EurOrient Financial Group
818-206-5322
MEDIA ANNOUNCEMENT jeff.mustard@eurorient.org
Ron Nechemia, Chairman of EurOrient Financial Group,
Authors Technical Financial Article on History of
Asset Securitization for China’s Leading Financial Publication
International Finance Magazine
LOS ANGELES, CALIF.: 21 April 2009 – Offered in a new article authored by one of the world’s
leading international financial authorities, Mr. Nechemia the Chairman of the Board of Directors of
EurOrient Financial Group (“EurOrient”), policy makers, financial practitioners and investors will be both
intrigued and enlightened about potential remedies for what began as a financial crisis in North America in
August 2007 that has now developed into a global economic meltdown. Moreover, anyone interested in
better understanding the Subprime Lending Crisis and how it evolved will be treated to an insightful
historical account offered in Mr. Nechemia’s new article published in China’s leading Financial
Publication.
In his article, Mr. Nechemia argues that the rapid innovation in asset securitization technology is the root
cause of contemporary financial market development of the past three decades. Published by International
Finance Magazine (“IFM”), Mr. Nechemia observes that, “the failures in today’s financial markets can be
traced to the creation and Frankenstein-like mangling and market-butchering of the financial product
known as Asset Securitization, or what the public at large has recently come to learn is Subprime Lending
that triggered the global financial meltdown.”
In his recently published article, Asset Securitization: Revolution, Evolution, Devolution. The Rise and Fall
of the Most Important Financial Instrument in Banking, Mr. Nechemia traces the success of Asset
Securitization back to its introduction in the early 70s and how, “this financial instrument and the various
permutations it morphed into during a more than 30-year period enabled the unprecedented growth of
capital and financial markets in both the United States and abroad.”
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2. Following the publication of two prior question- and-answer-style interviews, the first given by Mr.
Nechemia for International Finance Magazine published in May 2008 in an article titled, Guard Against
the Influence Brought by Subprime Landing Crisis, at which time Mr. Nechemia announced that he saw a
systemic financial crisis brewing and warned that in the months to come the United States was likely to
face a once-in-a-lifetime financial crisis, an oil shock, sharply declining consumer confidence and,
ultimately, a deep recession. In that article he also foretold of homeowners defaulting on mortgages,
trillions of dollars of mortgage-backed securities unraveling worldwide and the global financial system
shuddering to a halt. The second interview, a Cover Story published in March 2009, “At the Epicenter:
Where the Financial System Meets the Real Economy,” Mr. Nechemia offers observations and insightful
commentary regarding the critical financial issues as it relates to the world’s global financial crisis, its
impact on China, recommended reforms and action steps, along with forecasts of the Chinese economy in
the year to come.
International Finance Magazine is China’s only financial publication supervised by the China Council for
the Promotion of International Trade. Following the excellent reception and accuracy of his market
commentary, the Magazine, which is devoted to national and international investment and financing
markets, asked Mr. Nechemia to write a series of financial and investment-related articles. Says Mrs.
Luyang Li, Editor-in-Chief, of International Finance Magazine. “Mr. Nechemia’s scholarly and accurate
analysis in his prior interviews were so insightful, we asked him if he would write a series of articles that
sheds light on the reasons that led to the current financial crisis in North America that has now developed
into a global economic meltdown.”
“For this new article, Mr. Nechemia suggested he’d like to provide a thoughtful, technical paper for the
crisis starting with a historical overview of Asset Securitization, the financial instrument, according to him
that has been recognized by eminent academics as the most important engine of reform in our financial
system.” Mr. Nechemia presents the case that Asset Securitization has emerged in recent times and is
viewed as a revolution in the banking and financial services industry by industry practitioners.” says Mrs.
Luyang Li. She adds, “we thought his concept for an article was not just timely, but fascinating and would
be appreciated by our highly educated readers.”
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3. In his 3,000 plus-words article, Mr. Nechemia argues that among other things, the “Asset Securitization
product set new benchmark standards of innovation and productivity, credit enhancement and risk analysis,
but in the end, left unchecked and to open market devices, is what he suggests, contributed greatly to the
U.S. financial collapse and its tsunami like ripple effect throughout the world.”
The article goes on to discuss that many measures are required to repair what has become a badly damaged
international financial system and proven dysfunctional financial architecture. Moreover, Mr. Nechemia
provides thoughtful solutions to resolve some of the critical issues necessary to begin mending our credit
systems that will foster healthy and productive financial systems, revitalizing and reenergizing productivity
going forward. A potential remedy he offers can be replicated by adopting oversight and compliance
practices currently utilized by the United States Food and Drug Administration, among other solutions as
well.
According to Editor-in-chief of International Financial Magazine Mrs. Luyang Li, “readers will find this
article, as others Mr. Nechemia has authored exclusively for our publication, interesting, fascinating,
provocative and even useful to those who call investment banking their profession.”
In the article’s concluding paragraph, Mr. Nechemia suggests the following:
The introduction of Asset Securitization, and its evolution over three decades, has had a profound
impact on consumers and financial institutions as an innovative product and no doubt, it will continue
to remain so. In the light of recent events it is clear that more and better regulatory approaches must
be instituted in order to ensure that the original model and some of its innovative iterations
reconstitute to the original power and value they provided. In this manner, the markets will
reset, consumers will benefit and Asset Securitization can regain its rightful perch as one of the most
valuable products and financial instruments in banking history.
The International Finance Magazine features the country’s senior government officials, prominent business
leaders and high-profile financiers in China, as well as the world. Since first being published in 2000, the
Magazine has featured government and finance icons such as Mr. Chen Yuan, the President of National
Development Bank; Mr. Samuel A. DiPiazza, Jr., CEO of PricewaterhouseCoopers; Mr. Dai Xianglong,
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4. Chairman of National Council for Social Security Fund; Mr. Haruhiko Kuroda, President of ADB; Mr. Li
Lihui President of the Bank of China; Mr. Charles Li, Chairman and CEO of JPMorgan; Mr. Robert
Greifeld CEO of NASDAQ; Mr. Paul Wolfowitz, President of World Bank; Mr. Francois Bourguignon
The World Bank’s Chief Economist; Mr. Wang Lianzhou, The Economist, among scores of other prolific
personalities within the Chinese as well as global financial community.
In an uncommon publishing move, in the same March issue, Mr. Nechemia was also profiled in a second
article, “Mr. Ron Nechemia: A Devoted International Civil Servant.” Says Mrs. Luyang, “this full page
piece offered insight into Mr. Nechemia, he has a unique and profound perspective we felt it was important
to provide our readers and that they would appreciate.”
About Mr. Ron Nechemia
Mr. Ron Nechemia is an international political economist and a political risk analyst specializing in
country/political risks in Asia, with particular expertise in China. Mr. Nechemia's unique wealth of
knowledge has earned him many international awards and recognitions. He is frequently invited to consult
and to advise in Special High-Level Policy Dialog to express its views and to share experiences on
financing for development and on trade and investment related issues in front of the international
community bilateral and multilateral organizations such as the Bretton Woods Institutions -- the World
Bank and the International Monetary Fund (IMF), United Nations General Assembly, United Nations
Economic and Social Council (ECOSOC) and the World Trade Organization (WTO). Mr. Nechemia is a
member of the UNCTAD/ICC Investment Advisory Council and recognized as a foreign financial expert
by the State Administration of Foreign Experts, the People's Republic Of China and he is frequently
invited to advise and lecture on behalf of governments such as the United States of America, Republic of
the Philippines, the People's Republic of China, South Korea, and the State of California Department of
Energy just to name a few.
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5. About EurOrient
EurOrient Financial Group is a private sector global development finance institution accredited financial
institution by United Nations General Assembly on Financing for Development. The mission of the
EurOrient Financial Group is to support the economic and social development efforts of the less developed
countries as they, in particular, seek to achieve the Millennium Development Goals ("MDGs").
The EurOrient's principal objective is to reducing poverty and promoting sustainable economic growth.
EurOrient invests in projects and programs that promote social development, build human capacities, and
address host government priorities for investments in physical infrastructure that promote and enhance
social development. These projects include roads, transportation and communication systems, water,
sanitation and other types of investments with social development outcomes such as improved quality of
life and increased human knowledge and skills.
About International Finance Magazine
Founded in 2000, International Financing Magazine is a Beijing–based magazine devoted to national and
international investment industry in China. The magazine's driving mission is to increase knowledge of
economic conditions in China, examine country and world-wide impact, and highlight key financial
players in China and around the world; the publication is recognized as one of the most influential
magazines in China. It is distributed to the largest government agencies and financial institutions in the
country and is read by China’s business elite. The magazine has multiple affiliate website relationships that
further drive its global readership and influence. Partnership with most periodical databank networks, such
as: www.cnki.net; www.wanfangdata.com.cn; www.cqivp.com; www.sina.com; www.qg.com.cn;
www.sinoprojects.com. Among them, all articles are readable on www.cnki.net;
www.wanfangdata.com.cn; www.cqivp.com.
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6. EurOrient at Glance
Headquarters: Los Angeles, California
Website: www.eurorient.org
CEO: Mr. Ron Nechemia
Contacts
Media Contact: Jeff Mustard, Spokesperson for the President and the Chair Person of the Board of
Directors of the EurOrient Financial Group.
Tel: 818-206-5322
Email: jeff.mustard@eurorient.org
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