Welcome to the major leagues of debt. Collateralized debt obligations, almost always referred to as a CDOs, are horrendously complicated deals that often leave anyone without a MBA wondering what was put into these CDOs.

The first thing to understand about bonds, (aka debt) is that bonds are often backed by something else. Think about your home mortgage. If you don't pay your mortgage, the bank can take the house. You end up homeless, and the bank sells the house to pay off the rest of that mortgage. There is something "backing" that mortgage; something lender can fall back on, if you don't pay your bills like a good human being. That's called collateral.

CDOs are one flavor of an entire sector of investing called structured finance, and they are also backed. CDOs, in the simplest concept, are just bonds backed by something else. In most cases, a CDO is backed by a collection of various types of debt. CDOs can be home mortgages, or other types of debt like credit cards, auto loans, and personal loans. Most of these types of debt are usually considered a bit more risky and they don't have the backing that a home loan does. So, if you think it through, you can imagine that CDOs are usually considered a risky investment.

To take a step further, understand that CDOs have multiple flavors within each CDO. These flavors are called tranches. If you've taken French, you might recognize the word, it means "slice" or "portion." Each slice of that CDO you invest in is a little different and carries different amounts of risk.

You could invest in the lowest risk tranche of the CDO, which would provide you lower risk. But, you don't get a good return on that investment. Or, you can be the heroic adventurer of bonds and invest in the lowest-grade tranche of the CDO. You'll make an amazing return, but if the economy even looks at you wrong, you might lose the entire investment.

CDOs aren¿t easy, and are almost always invested in by mutual funds, insurance companies and hedge funds. As an individual investor, you will probably not come across a CDO you can participate in.

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Wednesday, July 23, 2008

First-of-a-Kind Technology to Help Doctors Care for Premature Babies

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ARMONK, NY and TORONTO, Jul 23, 2008 (Canada NewsWire via COMTEX) ----IBM and University of Ontario Institute of Technology Collaborate With

Canadian Hospital to Help Predict Changes in Infants' Condition

IBM (NYSE: IBM) and the University of Ontario Institute of Technology (UOIT) announced today a first-of-a-kind research project to help doctors detect subtle changes in the condition of critically ill premature babies.

The project will see a group of internationally recognized researchers, led by Dr. Carolyn McGregor, a UOIT associate professor and Canada Research Chair in Health Informatics, use advanced stream computing software developed by IBM Research to work toward greatly enhancing the decision-making capabilities of doctors. The software ingests a constant stream of biomedical data, such as heart rate and respiration, along with environmental data gathered from advanced sensors and more traditional monitoring equipment on and around the babies.

The researchers will also use the software to apply findings from Dr. McGregor's body of research to help make "sense" of the data and, in near-real-time, feed back the resulting analysis to health-care professionals so they can predict potential changes in an infant's condition with greater accuracy and intervene more quickly.

Physicians in neonatal intensive care units (NICU) at Toronto's Hospital for Sick Children and two other international hospitals are participating in the study.

Monitoring "preemies" as a patient group is especially important as certain life-threatening conditions such as infection can be detected up to 24 hours in advance by observing changes in physiological data streams.

The type of information that will come out of the research project is not available today. Currently, physicians monitoring preemies rely on a paper-based process that involves manually looking at the readings from various monitors and getting feedback from the nurses providing care.

"This research has the potential to greatly impact neonatal care through reduced mortality and morbidity rates and overall health-care costs," said Dr. McGregor. "By merging our research and technology, we are able to collect more detailed patient data in a systematic manner, do online health analysis and decision support, and get advanced early warning of emerging patterns that could predict a medical event."

When fully developed, IBM's software will be capable of processing the 512 readings per second generated by some of these medical devices and UOIT researchers will further test and develop its ability to analyze these vast quantities of data in real time.

Initially researchers will use NICU medical devices in UOIT's state-of-the-art Health Informatics Laboratory to test IBM's software using simulated patient mirroring data. Then the software will be tested using de-identified actual patient data. The de-identified data is recorded in a way that enables researchers to alter some variables, play it back and run simulations for further study.

IBM awarded Dr. McGregor access to the prototype software patented by researchers at its T.J. Watson research facility in New York under its First of a Kind program, which is designed to accelerate the delivery of innovative technologies to the market and link IBM's research work to real world problems.

"Right now, there is an enormous amount of critical data produced by machines monitoring patients," said Don Aldridge, business executive for IBM research and life science. "That creates a challenge. The ability to quickly analyze that data and make informed decisions will help improve the overall quality of health care."

About IBM

For more information on IBM, visit www.ibm.com.

About UOIT

For more information on UOIT, visit www.uoit.ca.

SOURCE: IBM Canada Ltd.

Media contacts: For IBM: Leslie Plant, IBM Public Relations,
   Direct: (416) 478-9840, Mobile: (416) 526-5647, laplant@ca.ibm.com; For UOIT: Tony Doyle, Media and Communications, Direct:
   (905) 721-8668 ext. 2209, tony.doyle@uoit.ca

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