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To: ChanceIs who wrote (209629)	7/8/2009 9:07:26 AM
From: ChanceIs	Read Replies (1) \| Respond to of 306849

GE reneging on railcar orders???? I started reading this article for insights on transportation - which conforms a gloomy outlook. Sales of new rolling stock are way down. At the bottom we see that GE is trying to weasel out of a deal to buy rolling stock. No big deal - a difference of $35 million. But still, it doesn't reflect a lot of confidence on GE's part. Lots of belt tightening. Screwing suppliers. Tsk, Tsk, Tsk. _____________________________________________________ Greenbrier Posts Loss as Freight Transportation Demand Remains Low By TESS STYNES Greenbrier Cos. swung to a fiscal third-quarter loss on $55.7 million in goodwill write-downs and lower demand, though the railcar company said operating results improved from prior quarters. President and Chief Executive William A. Furman said rail loadings in North America are down about 20% and an estimated 20% to 25% of the region's rail car fleet remains idle. Greenbrier continues to trim operations and paid down $19 million in debt in the quarter, he said. The company will furlough an additional 550 workers and remains cautious about its outlook citing poor visibility. It is the third straight quarterly loss for Greenbrier, which like other freight transportation companies has seen demand sink. Earlier this year Greenbrier suspended its dividend and unveiled cost-cutting plans. The company recently calmed concerns about its debt, receiving a $75 million loan from distressed-asset investor WL Ross & Co., and lowering its credit line by two-thirds while easing its terms. For the quarter ended May 31, the company reported a loss of $50.5 million, or $3 a share, compared with year-earlier earnings of $8.1 million, or 49 cents a share. Excluding the write-downs, Greenbrier said it would have had a 3-cent profit. Revenue tumbled 36% to $244 million. Analysts polled by Thomson Reuters most recently were looking for a loss of 5 cents on revenue of $269 million. Gross margin fell to 10.9% from 12.7% amid lower volume and scrap metal prices. Railcar deliveries tumbled 60% to 800 units while backlog dropped to 14,100 units during the quarter valued at $1.25 billion, from 15,100 units at $1.31 billion. About 84% of the backlog is part of a disputed 2007 contract with one of its biggest customers, a General Electric Co. unit. GE Capital is trying to reduce, delay or otherwise cancel rail-car deliveries under the contract. Greenbrier said Tuesday it considers GE in breach of contract and that it expects the difference between what GE says it will accept for delivery and the amount required under the contract is 414 cars valued at about $35 million. The company has diversified into less cyclical businesses such as refurbishment and parts, leasing and services and marine manufacturing.

To: ChanceIs who wrote (209629)	7/8/2009 1:26:23 PM
From: Perspective	Read Replies (3) \| Respond to of 306849

I want to know how the FCUK crummy POS companies running low margin operations on incredible leverage with no equity to speak of get deals like this: yahoo.brand.edgar-online.com On February 27, 2007, TSI, LLC entered into the $260.0 million 2007 Senior Credit Facility... As of December 31, 2008, TSI, LLC had $181.8 million outstanding under the Term Loan Facility. Borrowings under the Term Loan Facility will, at TSI, LLC’s option, bear interest at either the administrative agent’s base rate plus 0.75% or its Eurodollar rate plus 1.75%, each as defined in the related 2007 Credit Agreement. The interest rate on these borrowings was 3.7% as of December 31, 2008. The Term Loan Facility matures on the earlier of (a) February 27, 2014 or (b) August 1, 2013 if the Senior Discount Notes are still outstanding. TSI, LLC is required A FIVE YEAR LOAN AT 3.7% ?!? These guys have NO equity and operate in a notoriously low margin business. The bankers who give low quality sweetheart deals like this should be imprisoned. And the FDIC should be all over their hides for writing garbage loans like this that will end up put to the taxpayer. If they had to arrange their financing at anything approaching a fair market rate, they'd by BK already. Let me guess - the banker who arranged the deal gets VIP treatment at one of their clubs. EDIT: I did at least see that their zero-coupon bonds will actually convert to forced interest payments next month. That's good for cash flow - NOT: On February 1, 2009, our Senior Discount Notes will be fully accreted with an outstanding balance of $138.5 million. Semi-annual cash interest payments of $7.6 million will be required commencing August 1, 2009. From January 1, 2009 through February 26, 2009, we paid $5.4 million for an additional 2.0 million shares of common stock. DISCLOSURE: short some, considering more. `BC

To: ChanceIs who wrote (209629)	7/8/2009 1:41:11 PM
From: RockyBalboa	Read Replies (1) \| Respond to of 306849

Here is something on-topic, a triumph of sales again. How to turn dirt into gold: Morgan Stanley Plans to Turn Downgraded Loan CDO Into AAA Bonds Share \| Email \| Print \| A A A By Pierre Paulden, Caroline Salas and Sarah Mulholland July 8 (Bloomberg) -- Morgan Stanley plans to repackage a downgraded collateralized debt obligation backed by leveraged loans into new securities with AAA ratings in the first transaction of its kind, said two people familiar with the sale. Morgan Stanley is selling $87.1 million of securities that it expects to receive top AAA ratings and $42.9 million of notes graded Baa2, the second-lowest investment grade by Moody’s Investors Service, according to marketing documents obtained by Bloomberg News. The bonds were created from Greywolf CLO I Ltd., a CDO arranged in January 2007 by Goldman Sachs Group Inc. and managed by Greywolf Capital Management LP, an investment firm based in Purchase, New York. Two years after the credit markets began to seize up, costing the world’s biggest financial institutions $1.47 trillion in writedowns and losses, banks are again taking so- called structured finance securities and turning them into new debt investments with top credit ratings. While the Morgan Stanley deal is the first to involve CDOs of loans, banks have been doing the same with commercial mortgage-backed securities in recent weeks. A lot of banks and insurers “cannot buy anything but AAA,” said Sylvain Raynes, a principal at R&R Consulting in New York and co-author of “Elements of Structured Finance,” which is due to be published in November by Oxford University Press. “You’re manufacturing AAA out of not AAA, therefore allowing those people who have AAA written on their forehead to buy.” Copying Re-REMICs New York-based Morgan Stanley is copying a financing structure known as Re-REMICs that bundle mortgage securities into new bonds that often offer investors an additional layer of protection, or collateral, from downgrades. Credit-rating cuts may sometimes force investors to sell the debt and cause financial institutions that own the bonds to increase capital. Jennifer Sala, a spokeswoman for Morgan Stanley, and Gregory Mount, a Greywolf partner, declined to comment. Moody’s reduced the $365 million top-ranked portion of Greywolf in June by six levels to A3 from Aaa as the default rate on the loans in the CDO rose to 7 percent. The rating company cut 83 loan CDOs with the top rankings from May 28 through June 26, according to Wachovia Corp. Raising Capital Structured finance securities fueled the writedowns and losses at the world’s biggest financial institutions since the start of 2007, helping to plunge the U.S. economy into the worst recession since the 1930s. Finance companies have been forced to raise $1.27 trillion in capital, according to data compiled by Bloomberg. CDOs parcel fixed-income assets such as bonds or loans and slice them into new securities of varying risk intended to provide higher returns than other investments of the same rating. Greywolf is a type of CDO called a collateralized loan obligation, or CLO, which focuses on doing the same with company loans. Banks are using re-REMICs to protect against losses on residential-mortgage securities during the worst housing slump since the Great Depression. About $27 billion of home-loan bond Re-REMICs have been issued this year, up from $17 billion for all 2008, according to a June 12 report by Bank of America Merrill Lynch. Re-REMIC stands for “resecuritizations of real estate mortgage investment conduits,” the formal name of mortgage bonds. ‘Make Magic’ The strategy is increasingly being used for commercial mortgage debt. Standard & Poor’s said on June 26 that it may lower the rankings on $235.2 billion of bonds backed by loans on properties such as office buildings and shopping malls. Banks have issued about $2 billion of the debt in the last three weeks, according to Barclays Capital. That compares with $5.8 billion of similar offerings in all of 2008, Credit Suisse Group data show. “Somebody does something and it seems to make magic, and the other guy says ‘Hey, let’s do that, too,’” Raynes said. New York-based Goldman Sachs plans to sell $216.9 million of repackaged commercial mortgage debt, according to people familiar with the sale who declined to be identified because terms aren’t public. The re-REMIC is being carved out of four bonds sold in 2006, said the people. Michael DuVally, a Goldman Sachs spokesman, said he couldn’t comment. To contact the reporters on this story: Pierre Paulden in New York at ppaulden@bloomberg.net; Caroline Salas in New York at csalas1@bloomberg.net; Sarah Mulholland in New York at smulholland3@bloomberg.net Last Updated: July 8, 2009 09:54 EDT