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

To: Ramsey Su who wrote (49556)	1/12/2006 12:14:07 PM
From: russwinter	Read Replies (1) \| Respond to of 110194

Think the big story will be Calf, but that will be timed to the on going resets, combined with 5-7% lower appraisals on properties. No more "safety net" there either. They will have to beg, borrow, and steal to avoid delinquencies, and the second increasingly more difficult option just digs them in deeper. We will get more reports on the West Coast as the first quarter rolls along, and I can't believe the market will wait for the official reports in April. We could see some red flags in last quarter's reports. More of the same on spread compression: biz.yahoo.com From the release, oh on the last sentence, expecting "all the King's men"? and here come the resets and less competitive mortgages; The Company does not expect that the market changes which affected its fourth quarter results will continue to impact its results during the first quarter 2006. The principal reason is that the Company continually resets the prices it charges borrowers to reflect secondary market conditions, and loans being closed at this time generally have interest rates and points reflective of today's relationship between the yields on mortgages compared to LIBOR. In addition, it appears that the rapid change in the relationship between LIBOR and the yields on mortgages and junior mortgage securities that occurred during the fourth quarter is beginning to retrace toward a more typical range.