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Strategies & Market Trends : Zeev's Turnips - No Politics -- Ignore unavailable to you. Want to Upgrade?

To: Softechie who wrote (28489)	2/8/2002 12:36:56 AM
From: TREND1	Respond to of 99280

I agree EMLX may turn down some day, but wait until that happens before you short EMLX for the longer term. When the masses sense that EMLX is turned down, then go with the masses and short the hell out of it. BUT WHY DO IT NOW ! TODAY ! The masses will leave TA tracks to follow. Larry Dudash

To: Softechie who wrote (28489)	2/8/2002 2:28:02 AM
From: Teri Garner	Respond to of 99280

Timebombs in the Vault Robert Lenzner, Forbes Magazine, 02.18.02 Like Enron, the nation's biggest banks have risky off-balance-sheet liabilities that are barely disclosed. Brace for the next disaster. They didn't want to do it, but they had no choice: J.P. Morgan Chase, Citigroup, Bank of America and other banks shelled out unsecured loans of $3 billion to the doomed Enron Corp. in October, weeks before the firm collapsed into Chapter 11 amid accusations of fraud, self-dealing and a cover-up. The fallout was ugly. The $3 billion loan sells at 20 cents on the dollar today, posing a potential writeoff of $2.4 billion for the 46 banks involved. All told, J.P. Morgan Chase (nyse: JPM - news - people)'s total Enron exposure cost it $450 million in the December quarter, pushing the bank into the red. Citigroup (nyse: C - news - people) took a charge of $228 million and could be forced to take still more, given Enron's moribund state; the sum amounts to only 50% of its unsecured exposure to Enron. Northern Trust (nasdaq: NTRS - news - people) took a $43.5 million charge. The banks were forced to throw good money after bad because, six months earlier, they had agreed (in exchange for meager fees) to cover Enron's financing needs should the high-flying, investment-grade energy giant ever find itself in real trouble. Hey--who knew? But this multibillion-dollar exposure was never shown on the banks' balance sheets as outstanding loans, because they aren't. Instead, the ill-advised promises were listed in the footnotes to the banks' financial statements. In the Enron aftermath, "off-balance-sheet" has a bad ring. Regulators vow to force banks to disclose such promises more openly and increase their reserves against potential future losses from this activity. More reserves means lower earnings and lower stock prices. The sad truth about lending: Bad things happen to good companies. Xerox, Lucent and Kmart, among others, have drawn down billions in bank loans as their credit ratings have sunk, calling in promises made by banks when these borrowers looked a lot more solid. forbes.com