Skip to content
Subscriber Only

Why Death Bonds Look So Frail

They may have a lot of allure for Goldman Sachs, but investors remain wary of exotic securities
Why Death Bonds Look So Frail
Andrio Abero

It's fashionable to think everything Goldman Sachs (GS) touches turns to gold. After all, the investment firm emerged relatively unscathed from the subprime crisis. So if any big bank can tame the rough-and-tumble world of life settlements—the business of buying and selling unwanted life insurance policies—it should be Goldman.

But so far, Goldman's adventure seems more Wild West than Wall Street. With subprime spooking the markets, its plans to bundle policies into securities known as death bonds have been set back. And now the bank is bumping up against firms using Goldman's name in marketing materials without permission.