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To: Real Man who wrote (356452)	2/5/2008 3:04:49 PM
From: carranza2	Respond to of 436258

Forget the houses, get some bonds cheap. It appears that holders of structured products are selling to anyone who will buy in a direct reaction to the cuts. Why, you ask. Because the owners of this sludge believe that if the Fed cut 125 basis points in 8 days, then the crunch is far worse than they imagine and they'll be unable to sell their crud in the months ahead so they are dumping it now. This is not a joke: Opportunistic buyers said that sellers became more receptive to what had been below-market bids on Tuesday, when the Federal Reserve surprised many financial-market participants by cutting its overnight lending rate by 75 bp, to 3.5%. A handful of new deals, backed mainly by credit-card receivables and auto loans, also priced at wider spreads than they would have a week ago. The reason: Even as the rate cut move cheered some areas of Wall Street, fund managers and investment banks that have been trying to unload huge structured-product inventories took the news as an indication that the Fed believes the credit crisis is still going strong. That means their holdings - especially those tied to the same troubled mortgage products that caused the debt-market squeeze- could continue to lose value in the months ahead. securitization.net