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Biotech / Medical : Biotech Valuation -- Ignore unavailable to you. Want to Upgrade?

To: Biomaven who wrote (6254)	4/30/2002 11:49:52 PM
From: IRWIN JAMES FRANKEL	Read Replies (1) \| Respond to of 52153

<OT> JP Morgan pulling out of the backup lines of credit when they represent half of the market suggests to me that they do not want to structure past FASB. Until Enron blows over I would expect the CPA firms to resist creative accounting. Failure of the commercial paper market does seem to be good for the banks. Yet one tells me they are not ready for the business. When you realize that banks could have to come up with $700 million to replace just the 50% that JPM is dropping it is easy to see why the banks won't take up the slack. I know that my big clients all have been pushing for bankruptcy reform for years. I am less sanguine about the outcome. The bankruptcy courts and the US Trustees seem ill equipped, under staffed and poorly automated to administer any complex assessment of just how much of a debtors debts should be discharged. Then to the extent that part of the debts are not discharged the collection of these non-discharged debts will require new systems for the creditors and the industry. And for what, to collect from the marginal debtors who have failed once and will be more likely to fail again for not getting a fresh start. Perhaps, it will work but I am from Missouri - Show Me. Personally, I would rather they filled the loopholes in discharging defalcations, fraud and intentional torts. The credit card investment idea may be a good one. If I were inclined that way (I'm not) then I would go for the Banks with "A" paper like COF rather than PVN which took on more marginal debtors. AXP's card portfolio is very different and I do not know how they would do in this environment. BTW, even if placements level off the pool of accounts to work will grow for another 18 months. So far placements are still growing and I am not convinced the turn is here. But ³ùˆ not have the view that my clients do. ij

To: Biomaven who wrote (6254)	5/1/2002 9:10:38 AM
From: tom pope	Respond to of 52153

If you are right that the volume of collections might be leveling off, then maybe the banks that are heavy credit cards issuers might be a decent speculation - these would be a play on the bankruptcy legislation as well. I guess American Express might be another decent play along the same lines. ML seems to agree with you, Peter. From Briefing: 09:01 ET Merrill Lynch on specialty finance Merrill Lynch believes that COF and HI should have good earnings growth regardless of the environment, athough they should work best if the economy remains somewhat sluggish, as credit concerns would likely remain modest and interest rate increases subdued or nonexistent; AXP could do particularly well if the economy and equity mkt heat up; ALD, SFI, and NLY should do well if the economy enters another downturn due to their yield and defensive status; and FRE will probably work best in a poor economy but will also do well if the economy remains sluggish.