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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory

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To: CalculatedRisk who wrote (92376)	3/17/2008 10:09:11 PM
From: blazenzim	Read Replies (2) of 110194

<Assuming no depression, this is a great deal for JPM.> I couldn't disagree more. JPM has assumed $383 billion of debt backed up by $395 billion in assets. Those assets are chock full of derivatives and garbage paper that I don't believe are worth even $200 billion in today's market. All day long, I heard a bunch of stupid Jack Asses say that JPM got a great deal because the building is worth more than the $236 million in equity value that they have agreed to pay. The building isn't even a rounding error compared to the debt that they have assumed. The debt isn't going away. The assets are a bunch of garbage. In addition, I see no incentive for the shareholders of Bear to approve this deal. If I were a shareholder, I'd rather take zero and force the company into bankruptcy rather than have JPM take the company over. As I see it, this deal is just another smoke and mirrors con job.

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