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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: Perspective who wrote (76274)	4/18/2007 8:07:52 PM
From: XoFruitCake	Respond to of 306849

"Originations should fall well over 50%. How can that support the present price, even without considering the subprime/AltA default concerns" I think DSL already indicate some slow down on mortgage origination. But the problem is that they don't slow down enough to make a material difference in earning yet. It also depend if they tigten up their underwriting. With so many short on these names (WM, CFC, DSL, BKUNA, FED), as long as the earning stay the same, it will trade high. I am puzzle as to what to do also.. One strategy someone I know used on NFI last year is to keep buying the put (small percentage of his portfolio) and when it break with the right news then buy a bunch... With DSL, BKUNA and FED, it is probably out of the question since the put are not traded actively. But CFC is certainly possible.