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

To: CalculatedRisk who wrote (73880)	11/8/2006 3:45:11 PM
From: TH	Respond to of 110194

CR, Oops. What is great about that clip is you can see the exact moment that he realizes he is trapped in a lie. Sad and pathetic. GT TH

To: CalculatedRisk who wrote (73880)	11/8/2006 4:33:37 PM
From: regli	Respond to of 110194

I hadn't watched a news conference with Bush in years but I did watch today. I have to say that I have never seen a more inept politician in my life and this includes any politician I have ever observed in other countries I stayed. The election of Bush puts into very serious question the whetting process politicians in the U.S. have to go through in order to get elected. I remember the media saying Bush won a debate because he came across as the nicer person. This exchange from 2000 says it rather well. What an incredibly uncritical and superficial media: transcripts.cnn.com "... KURTZ: By now, the press has settled on a storyline. In this case: Gore won on points, but lost in a new category created by the judges, body language. (BEGIN VIDEO CLIP, "THE EARLY SHOW") JANE CLAYSON, CBS ANCHOR: Those who criticize your performance last night used words like haughty, maybe condescending. (END VIDEO CLIP) (BEGIN VIDEO CLIP, "THE TODAY SHOW") COURIC: They could hear you audibly sighing or being exacerbated, as Governor Bush was answering questions. Do you think that is presidential behavior? GORE: Well, I guess sometimes the mike picks up your reaction to the other person. And I'll try to be more careful on that. (END VIDEO CLIP) KURTZ: Even some pundits who had earlier declared Gore the winner began ridiculing how he looked. ROBERT NOVAK, CNN "CROSSFIRE": He looked like he was big and pasty and pompous. KURTZ: Now the Fourth Estate is seizing on exaggerations by the vice president -- for example: that he was with the top federal emergency official on a visit to Texas. Forget the original verdict that he beat the Texas governor on substance. Gore now sounds like the loser. ..."

To: CalculatedRisk who wrote (73880)	11/8/2006 6:08:09 PM
From: loantech	Respond to of 110194

I got a C in speech in college. I am about on the same level as that complete bozo. Maybe I otta run for office? <VBG>

To: CalculatedRisk who wrote (73880)	11/9/2006 1:13:42 PM
From: ild	Read Replies (1) \| Respond to of 110194

New reality: don't tax, just borrow and spend ocbj.com

To: CalculatedRisk who wrote (73880)	11/9/2006 3:55:48 PM
From: ild	Respond to of 110194

Another story from Tanta: A few years ago I happened to be in a city in the midwest, so I dropped in on an old friend who is a risk manager at Pretty Darn Big Ass Regional Bank's mortgage operations. She gave me a tour of the outfit; we were looking over the trading area and I commented that the traders and deal managers, who seemed very young to me, didn't seem very happy today. "Yeah," she said, "they're all bummed out. They think they've been burned." Some deal went bad, a trade wobbled, dollars were lost. Unpleasant, contained, forgivable. "The sad part is that they still don't know the meaning of the word 'burned.' I have tried to tell them, but young bankers do not learn from old bankers. They only learn from new RTCs." I can remember coming into work in the morning and finding Federal Marshals with a Cease and Desist Order in their back pockets busy putting seals on the portfolio manager's office door. Literally. And my thrift was only "technically insolvent" when it was finally sold off to one of its stronger brethren (which was solvent but "technically insane"). Anyway, that's one of my definitions of being burned, and my friend is right: there's a new generation of bright shiny energetic perfectly nice young persons getting themselves promoted into more and more responsible positions in mortgage lending who think that the stories told by old timers like me and my friend are quaintly charming; I'm sure they'd find Hoenig merely quaint if they read the speech, which they won't because it won't be posted on Bloomberg in a 300-word exerpt and they're, like, busy. Last year I was doing some consulting work for another, smaller bank who was opening up a full-dress wholesale mortgage operation (talk about buying at the top of the market, but never mind). At one point, as I was writing their board-level risk management policies, I asked them 1) who had the authority to shut the pipeline down at any given point in the business day and 2) who had a copy of the instructions for performing said action on the software they were using. The answer was 1) shut it down? the whole thing? and 2) there's no way to shut it down short of disabling some function like pricing, which creates its own separate audit/processing problems, so we'd never do that. I said, the job of the risk manager is to understand that a day might come where you will most assuredly need to shut it down, and to be willing to do it regardless of the collateral mess it makes. A whole room full of grownups, and not a one of them could imagine a scenario in which they'd be willing to risk messing up their reports in order to Stop The Hemhorrhaging. They just don't believe in hemhorrhaging. That used to happen in the old days, but we've solved that problem. We're too sophisticated now. You see. I talked to one of the IT guys on the side, found a quick and dirty back-door way to throw the switch, wrote up the instructions, and left them in the file when I turned in the final documents. I didn't bill them for that part because they hadn't asked me to do it. It probably got thrown away, but it might be in someone's file drawer some day if it ever becomes necessary. Assuming the file drawer doesn't have that ugly yellow tape stretched across it by then. ---------------------------------------------------------- The hedging thing is curious. I got trained in pipeline/inventory/portfolio hedging in the days when that was a tool to mitigate interest rate risk. These days, I run into more and more youngsters who seem to think they are eliminating risk. I find, by the way, that they are also way less likely than their elders to be able to put an accurate price on their hedge costs, by which I mean the total hedge costs including operational expenses. A number of years ago I worked for a non-depository mortgage banking outfit and the mortgage trader went sick for a week. When he got back and found out that I had unloaded a handful of FHA ARMs as whole loans/servicing released to a conduit, he got all medieval on my ass because I coulda made two ticks excess servicing saving that crap up for a Ginnie II security. I asked him if he had any idea how much operational person/hours we'd have to blow through to make that $250, and he told me that operational expenses just weren't his business. I remain convinced that if some banks had to truly account for their hedge costs, the balance sheet would need more Cipro than I do. But everybody's a "specialist" these days, so the ones making these super-duper-sophisticated trades don't understand what it costs to deliver into them, and the folks who do understand cat-herding costs are no longer allowed into the trading room. I just don't think this will end well.