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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Kailash who wrote (48399)	12/30/2005 8:57:58 AM
From: russwinter	Read Replies (1) \| Respond to of 110194

I don't know, it's perplexing, but I'd say a blend of corruption and moral hazard behavior? Here's are the spreads (last number) over Treasuries to take on these toxics. I would say that the FCBs have distorted pricing. FNMA 4.625 01/15/08 4.627 26.2 FHLMC 4.75 01/18/11 4.701 39.2 FHLMC 4.375 07/17/15 4.768 42.5

To: Kailash who wrote (48399)	12/30/2005 10:24:33 AM
From: russwinter	Read Replies (1) \| Respond to of 110194

161.58.5.90 Fine Print in Home Mortgages Causing Concern by Theodore Mantle, Thursday December 29 2005 wallstreetexaminer.com Retired dogcatcher Joseph Sicspakel of Weehawken, NJ has been working 16-hour shifts labeling miniature hand-painted porcelain monkey figurines in a Shanghai sweatshop since November, when he failed to make the full mortgage payment on his new townhome after the A.R.M. teaser rate expired. A victim of not reading the fine print in his mortgage paperwork, Joseph found himself shipped overseas on a legal technicality invoked by the Chinese holder of his securitized home loan. Unable to scrape together the necessary funds to maintain his monthly payment schedule after his interest rate was hiked, he now faces 14 years working off the balance laboring at 25 cents per hour in a factory that markets its products on American cable TV shopping channels. "Well at first I figured I could just ride this thing out, ya know, and my equity would keep goin' up like they said on them cassette tapes I got at the Wealth Power seminar," said Joseph. "But when I heard they already sold my furniture and plasma screen and turned my home into a laundromat I started to get a little worried." Like many new homeowners, Mr. Sicspakel was unfamiliar with the often arcane details found buried deep within multi-page contracts governing the terms of their home loans. Excited about the prospect of getting into the Real Estate market, they often don't bother taking time to study the fine print. Day spa technician Bertha Arsbigly of Fauxville, California was similarly surprised after being informed of her obligations under the interest-only adjustable rate mortgage she signed up for last year when she purchased her first home, a cozy 600 sq. ft. starter condo (complete with slab granite kitchen counterette and upgraded window treatments throughout) in the posh new English Garden Estates development. "When Ditech returned my call and said I was approved, I felt like I won the lottery!" said Ms. Arsbigly. "After all, I'd been on the waiting list for over a year, and there just aren't that many new homes available in Southern California in the $850,000 price range. I knew this was probably my only chance to get in." Currently unable to afford her recently increased monthly payment, she still doesn't regret her investment, convinced it will appreciate rapidly over the coming years. She does admit to being slightly nervous about starting her five-year assignment next week at the Karaoke Escort Hostess Bar in Tokyo, but remains confident. "I'm sure it will work out just fine. This could be a great opportunity for me to travel and see the world!" Meanwhile in Shanghai, Mr. Sicspakel has adapted well to a challenging situation. "The standard of living over here is just a little lower. We have to get used to it, that's all. Listen, I know my home's gonna keep goin' up and when I get back there I'll be able to cash out a ton of equity. So I'm not complainin'. But between you and me, my former career skills have come in mighty handy lately if ya get my drift."