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Politics : Welcome to Slider's Dugout -- Ignore unavailable to you. Want to Upgrade?

To: Broken_Clock who wrote (6098)	8/20/2007 1:12:45 PM
From: bearjones	Respond to of 50528

To: Mrs. OMalley who wrote (6098) 8/20/2007 12:33:50 PM From: This_is_the_end 2 Recommendations of 6101 Sorry. That analysis is so flawed I'm not sure where to begin. My thoughts precisely!! I was shocked to read it!

To: Broken_Clock who wrote (6098)	8/21/2007 1:22:34 AM
From: ahhaha	Read Replies (1) \| Respond to of 50528

It leaves out entirely how many derivatives were created and sold based on subprime. Please explain what kind of derivative uses a sub prime loan as a basis. That pool is vastly larger than the subprime pool. Assuming you can make that definition, why is it a pool? A pool designates inter item coordination, yet derivatives are generic while the loans that presumably base them are so varied in terms that coordination upon which a derivative could be struck isn't possible. Witness the dozen or so hedge funds wiped out the past month. Can you give an example that explicates the notion, "derivative on sub prime" so that I can put together how a hedge fund might be wiped out by these derivatives? You do realize that a hedge fund would be simultaneously long and short such alleged derivatives, so how would a change in their pooled face wipe the fund out? It leaves out entirely Alt A, Pay Option Arm, etc. What is "it"? Rates for mortgages are driven solely by the Fed. Then why has FED failed to affect a solution by the direct setting of mortgage rate? Instead, they're trying to shoot through the low Window. Here, FED says to MBSers, "come my children, come", but they won't drink the Cool Aid. Moreover, I guess you believe that FED solely "drives" Tbond rate. You will find that the Tbond rate determines the mortgage rate, and that FED has almost no ability to influence the Tbond up to Dual Mandate. Confidence or lack there of in the USD is a much larger factor. The fourth count of the crisis passed today when the fed funds market broke from target, and now is in command. In order to take back command FED would have to enter matched sales. So far, they haven't. Poof, crisis over, except for the frightened. You can lower rates all you want and still not be able to refi a home with negative equity...which most homes bought in 05/06 are presently at. Have you forgotten your pool? That is, you can't have your pool and ignore it. Besides, what's so bad about negative equity? Spells opportunity at the right price. Last I checked there is some capitalism left in the US(not much). In any event in Canada, issuing banks are buying distressed "subpools" by converting commersh into a note. Also, Banks lay groundwork for loan sales - TheDeal.com TheDeal.com reports Wall Street investment banks have started to lay the groundwork to offload billions of hung bridge loans and financing commitments. According to several mkt sources, banks have begun calling investors to sound them out about buying the loans. The investment banks, which have had to sit on billions of dollars worth of LBO-related debt they haven't been able to syndicate over the past few weeks, had previously been unwilling to sell the debt at what they perceived as fire-sale prices. That they seem more willing to consider the possibility suggests that a logjam created by a growing number of willing buyers for the loans, and a dearth of sellers, may be about to break. "We are engaging in price discovery," confirmed one leveraged finance banker, who noted that the LCDX index of loans has stabilized at around the 93-95 range (100 is par value) after hitting lows approaching 90 at the end of July, suggesting that there are buyers for senior debt at those levels. One source indicated Citigroup (C) is working to gather a coterie of loan investors to determine how much they are willing to pay for the loans, with the expectation that they will be able to presell the debt to them before pulling the trigger on the sales sometime in Sept. Goldman Sachs (GS) also has been calling collateralized loan obligations investors and others to let them know that blocks of debt are available at discounts, the source said. Suddenly, all the sturm und drang ends, and then no one remembers or ever knew what caused the sturming. Later, months later, you have slider, trying to discount the past, looking under the yen carry trade again for a bogey to explain yet another Gartman Bear, and Gartman, who was right, and then denied it, is still looking for Desolation Row.