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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: John Pitera who wrote (8792)	1/23/2008 10:06:58 PM
From: stomper	Read Replies (1) \| Respond to of 33421

Some of these things are pretty amazing. After Wells' Q3 call where Atkins claimed they had NO exposure to subprime paper or CDO's, I traced back some of the stuff out of the last WFC quarterly (i think it was a Cheyne issue or Victoria or something Eagle, I can't remember). It led initially to a JPM shadow-backed Canadian finance boutique that was selling some nasty CDO's that had been put together in an offshore entity in Bermuda that was incorporated as a JV beetween HSBC, BSC, C and MER. I'm sure it was some minor package, it was only about 300mm. WFC's had some 10% paper backing their Master Trust from this thing. My point being, no WAY these guys have any clue what they are holding, the risk behind it or who the ultimate counterparty is. And this was just poking around for an hour or two using Google on the weekend. I'm sure some of this stuff is wrapped tighter than the World's Largest Ball of Twine: Crazy, crazy times. -david