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Strategies & Market Trends : The coming US dollar crisis -- Ignore unavailable to you. Want to Upgrade?

To: stan_hughes who wrote (12280)	10/3/2008 11:21:43 AM
From: Real Man	Read Replies (1) \| Respond to of 71463

It is true, though - derivatives tend to price assets much above their value during good times, and a lot below where they should be when the tide is out. For example, with CDS collapse bonds can be priced as if default rate is 20%, where as in reality default rate may be close to 5%. This happened <G> It's all due to panic and meltdown. So, those who did not have the same crappy loans as others securitized (Wells Fargo) faired much better. Sometimes those were priced way below "recovery" - ah, the REPO man stuff, since nobody knows who owns the stuff or where. The market does have it's way with illiquid securities -g- I'd buy those if I had a few billion, disassemble them, and get the REPO men to work. Instant 100-200% profit -g-