Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Giordano Bruno who wrote (138535)	8/1/2008 9:13:06 PM
From: DebtBomb	Read Replies (2) \| Respond to of 306849

Put some lipstick on the pig. More pink slips are expected. Analysts predict a half-million more jobs could disappear over the rest of this year and say unemployment could climb to 6.5 percent by the middle of next year. With the employment situation deteriorating, there's growing worry that consumers will cut back on spending later this year, further hurting the economy. "People will absolutely shut off the spending spigots given the soured jobs market," predicted Richard Yamarone, economist at Argus Research. "The economic environment is in crummy shape." Jobless rate climbs as 51,000 jobs vanish biz.yahoo.com

To: Giordano Bruno who wrote (138535)	8/1/2008 9:43:31 PM
From: XoFruitCake	Read Replies (1) \| Respond to of 306849

"Has WB done any capital raises yet, or are they still in the "we're not planning to raise capital" stage of denial? EDIT: Did I hear right that they have $120B in pick-a-payment loans? " Yes, they do..And they have made 11B provision for the loan last Q. The assumption is in the range of 20% default rate with 50% severity based on a projection that the HPA will have another 14% or so to go before housing bottom out. The current loan loss serverity is about about 38% of the default loan. The tangible equity is in the 5+% range and tier 1 ratio is in the 8+% range. My bet is that the ultimate default rate is going to be much higher than 20% given the toxic nature of the option ARM. Their current weighted LTV on these loan is in the 85-86% range up from 74 or so % at origination. The default is ramping pretty fast. I think they add 3B NPA last Q. Meridith Whitney seems to think that WB need to raise capitol in the next 2 months... Have put on WB at about the current price.