Swap Fever: Big Money, Big Risks

Just one day before Olympia & York Developments Ltd. filed for bankruptcy protection, an unusual auction notice appeared deep in the back of The Wall Street Journal. In 11 inches of minuscule type, the advertisement invited blue-chip banks to bid on some of the most sophisticated financial vehicles around: a string of big interest-rate swaps between O&Y and Japan's Dai-Ichi Kangyo Bank Ltd.

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