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Strategies & Market Trends : The Residential Real Estate Crash Index

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To: CalculatedRisk who wrote (234464)12/27/2009 4:09:14 PM
From: Skeeter BugRead Replies (2) of 306849
 
CR,

1. do you think the banks have enough money to cover off balance sheet losses? if so, why continue with mark to myth?

2. do you think the banks have enough free cash flow to pay out billions in bonuses in light of deteriorating housing prices, a deteriorating private economy, increased defaults and decreasing debt outstanding (ie, money supply is shrinking)?

3. do you see china, japan, americans, etc... covering $2.5 trillion in roll over debt (as opposed to diversifying) AND the $1.8 trillion to keep debt from collapsing (money supply collapsing)? i understand china is no longer a net buyer of marginal treasuries (they are holding tight with what they have) and japan has outright threatened to sell their treasuries in the open market.

4. do you see rates staying low given japan is threatening to sell off treasuries and china has apparently decided not to buy additional treasuries?

5. obviously, if rates don't stay low then housing gets *hammered*. how do you see the economy going forward if housing prices were to get hammered with increased rates?

tia...
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