rmptr
Silver Member
- Joined
- Dec 25, 2007
- Messages
- 3,274
- Reaction score
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- Location
- Tierra del Fuego
- Detector(s) used
- Tesoro.Fisher.Garrett
- #21
Thread Owner
OK, I slipped and took another peek into Pandora's box.
It's just not pretty, GPURS.
I really appreciate you have a rosey outlook... kinda perks me up a bit.
And I couldn't for a second denigrate your capability, you claim marked success! Great!
Show me this fellow's diatribe is wrong, or even incorrect. Go for haf a bubble off,if you would!
The numbers are staggering to the imagination.
Yet we KNOW them to be fact.
The market figures are common knowledge.
They can't be disputed.
If you are able to show me where there may be cause for a market turnaround, please do so.
Be specific. What will it take?
Here's the new clip:
After yesterday’s market losses, it’s obvious that hardly anybody was fooled for more than 24 hours into thinking that the unlimited bail-out would calm investors, or stabilze mortgage rates, or anything of that sort.
And I’ll repeat once again that it can’t. Calling a bottom in this market is a very simple thing to do, it’s just that no-one wants to do it, for good reasons perhaps (fear).
The mayhem hasn’t even started for real yet: the problems will be solved when both of the following issues have been fully addressed.
First, home prices will have to go down to trendline levels; to do so, they will need to lose around 65% of their 2005-6 peak levels. They are down about 20% today, according to Robert Shiller. Because swings of this magnitude are always intensified by sheer momentum, the losses, as I have said 1000 times, will be close to 80%.
Second, the securities, derivatives and other casino toilet paper that reside in the vaults of banks, pension funds, money funds and elsewhere, will have to be exposed to daylight and valued at the market price of the day, not that of 10 years ago or 10 years in the future. This is called mark-to-market, and it gets harder to avoid it, try as they all might.
Until these two conditions have been met, the only result of actions such as the Treasury "rescue" of Fannie and Freddie will be one, and one only: the transfer of public funds, revenue drawn from taxpayers past, present, and future, into private coffers. And no, I do not believe that is an unintended consequence.
The news of the day: everyone’s eyes are fixed on Lehman, which lost 44.95% yesterday. Today, Lehman faces failed take-over talks with suitors like the Korean Development Bank. Ostensibly over the price it asks for itself, but I bet you that in reality it’s over the "assets”, the toilet paper, that Lehman holds.
The bank is now trying to sell its asset-management division, Neuberger, but that only reveals the next problem: investors value Lehman at the same price as Neuberger. So if they sell it, Lehman has ZERO value. Expect another rescue from Paulson and the Fed very soon, if Lehman keeps plunging. Interestingly, as Lehman is up a few points this morning, its holding company scrapes the bottom of the barrel. It's like the Russian dolls.
More fall-out. The Fannie and Freddie purchase by the American public included a sucker punch hit for holders of preferred shares. Many of those holders were smaller US banks. The halt in dividend pay-out on the shares is bad enough for many of them. But that’s not all: to (re-) finance their debt, they would like to (as usual) issue shares, including preferred shares.
But who now is still nuts enough to buy that stuff? It could be wiped out tomorrow morning, if the Treasury pulls the same stunt again. Talk about a double whammy!
So look beyond Lehman. Watch what happens to Fifth Third, Key Corp, Wachovia. They are all bleeding now.
What really scares me today, though, is Washington Mutual. Down 20% yesterday, and the same today. WaMu is the United States' largest savings and loan association, with 2600 offices, the third largest mortgage lender (!!), and 9th largest credit card company.
If WaMu fails, we will see the Treasury need to bail out the FDIC soon, just because of its size. And then there’s no telling how other commercial banks will fare. Or your allegedly "guaranteed" deposits. WaMu is the proverbial big fish. Make that BIG FISH.
<eof>
GPURS, have you read what this fellow says?
I would be greatly appreciative if you would show me where he is wrong, incorrect, made a false assumption,
or is a bald-faced liar and prevaricator of the first degree.
And you show me proof to controvert the factual matters he has presented.
I'm reasonably sure you can not hide the depth of the problem from those folks at GM and Ford. Or Toyoda!
My last post showed where I could gross a decent chunk of money, overnight. Wealth.
Yet nothing of value to society was created, therefore pain and suffering can only be the logical end result.
It was a digital entry in the ethernet, with no substance. A farce.
I look forward to your presentation in reply.
Thank you!
rmptr
It's just not pretty, GPURS.
I really appreciate you have a rosey outlook... kinda perks me up a bit.
And I couldn't for a second denigrate your capability, you claim marked success! Great!
Show me this fellow's diatribe is wrong, or even incorrect. Go for haf a bubble off,if you would!
The numbers are staggering to the imagination.
Yet we KNOW them to be fact.
The market figures are common knowledge.
They can't be disputed.
If you are able to show me where there may be cause for a market turnaround, please do so.
Be specific. What will it take?
Here's the new clip:
After yesterday’s market losses, it’s obvious that hardly anybody was fooled for more than 24 hours into thinking that the unlimited bail-out would calm investors, or stabilze mortgage rates, or anything of that sort.
And I’ll repeat once again that it can’t. Calling a bottom in this market is a very simple thing to do, it’s just that no-one wants to do it, for good reasons perhaps (fear).
The mayhem hasn’t even started for real yet: the problems will be solved when both of the following issues have been fully addressed.
First, home prices will have to go down to trendline levels; to do so, they will need to lose around 65% of their 2005-6 peak levels. They are down about 20% today, according to Robert Shiller. Because swings of this magnitude are always intensified by sheer momentum, the losses, as I have said 1000 times, will be close to 80%.
Second, the securities, derivatives and other casino toilet paper that reside in the vaults of banks, pension funds, money funds and elsewhere, will have to be exposed to daylight and valued at the market price of the day, not that of 10 years ago or 10 years in the future. This is called mark-to-market, and it gets harder to avoid it, try as they all might.
Until these two conditions have been met, the only result of actions such as the Treasury "rescue" of Fannie and Freddie will be one, and one only: the transfer of public funds, revenue drawn from taxpayers past, present, and future, into private coffers. And no, I do not believe that is an unintended consequence.
The news of the day: everyone’s eyes are fixed on Lehman, which lost 44.95% yesterday. Today, Lehman faces failed take-over talks with suitors like the Korean Development Bank. Ostensibly over the price it asks for itself, but I bet you that in reality it’s over the "assets”, the toilet paper, that Lehman holds.
The bank is now trying to sell its asset-management division, Neuberger, but that only reveals the next problem: investors value Lehman at the same price as Neuberger. So if they sell it, Lehman has ZERO value. Expect another rescue from Paulson and the Fed very soon, if Lehman keeps plunging. Interestingly, as Lehman is up a few points this morning, its holding company scrapes the bottom of the barrel. It's like the Russian dolls.
More fall-out. The Fannie and Freddie purchase by the American public included a sucker punch hit for holders of preferred shares. Many of those holders were smaller US banks. The halt in dividend pay-out on the shares is bad enough for many of them. But that’s not all: to (re-) finance their debt, they would like to (as usual) issue shares, including preferred shares.
But who now is still nuts enough to buy that stuff? It could be wiped out tomorrow morning, if the Treasury pulls the same stunt again. Talk about a double whammy!
So look beyond Lehman. Watch what happens to Fifth Third, Key Corp, Wachovia. They are all bleeding now.
What really scares me today, though, is Washington Mutual. Down 20% yesterday, and the same today. WaMu is the United States' largest savings and loan association, with 2600 offices, the third largest mortgage lender (!!), and 9th largest credit card company.
If WaMu fails, we will see the Treasury need to bail out the FDIC soon, just because of its size. And then there’s no telling how other commercial banks will fare. Or your allegedly "guaranteed" deposits. WaMu is the proverbial big fish. Make that BIG FISH.
<eof>
GPURS, have you read what this fellow says?
I would be greatly appreciative if you would show me where he is wrong, incorrect, made a false assumption,
or is a bald-faced liar and prevaricator of the first degree.
And you show me proof to controvert the factual matters he has presented.
I'm reasonably sure you can not hide the depth of the problem from those folks at GM and Ford. Or Toyoda!
My last post showed where I could gross a decent chunk of money, overnight. Wealth.
Yet nothing of value to society was created, therefore pain and suffering can only be the logical end result.
It was a digital entry in the ethernet, with no substance. A farce.
I look forward to your presentation in reply.
Thank you!
rmptr
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