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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: Secret_Agent_Man who wrote (36800)	7/10/2008 7:09:13 PM
From: TobagoJack	Respond to of 218913

no need for revenge against insects simple smack to the head will do while insect in flight, not enough to ooze out the green stuffing against the table top, for fear to kill the joy, but just enough to daze in mid air, so that the joy can still buzz around strutting, sort of ;0) btw, recommendation, hoardgold, for the platform appears to be receding again, and with so many shorts full of holes tearing up with mixed emotions, mixing in their trepidation for the dark interregnum, and their sum total of all clear and present fears, that everything they have is going down, and all that they need is going up - a classic wedgie, with a knotty twist :0) in the mean nasty time, just in in-tray if the following is correct: "The GSEs own more than$500 billion in Alt A and subprime paper. They have taken less than $20billion in write downs." from: acrossthecurve.com then they have indeed no future as independent entities. the stock market values e.g. FRE at only $ 5,17 bn. as per today's close. however, it is supposed to raise somewhat more than that if i remember correctly. there were plans to raise something like $7bn. - which seems nigh impossible under the circumstances. even in the event that this capital were successfully raised, diluting current shareholders by more than half, it would only be a stop-gap measure as long as the housing market deteriorates further. besides, the above suggests that they are not really current with the writedowns yet anyway. so we have again the moving target problem - when a quarterly report is presented, it is said that 'x amount has been written off', but even while the sentence is uttered , more assets go bad. meanwhile, the leverage of the GSE's has always been legendary and scary, and by all accounts has increased rather than decreased, via a combination of capital destruction and underwriting more business. lastly, although Paulson talked a lot about wanting to impose 'market discipline' by 'allowing large institutions to fail' today, this resolve will likely not be in evidence when it comes to the bondholders of the GSEs - most of whom probably expect a bail-out as a matter of course (how can you bail out the bondholders of BSC, but not those of the GSEs? especially in view of the fact that agency debt is these days lurking in central bank reserves everywhere).