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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: E_K_S who wrote (39281)	9/14/2010 11:54:37 PM
From: Spekulatius	Respond to of 78740

re ARI - the operating model for the commercial mortgage REIT's (ARI, STWD) simply does not work. i might have worked if spreads for Commercial mortgage debt had stayed sky high as in late 2008/early 2009 in combination with access to relatively cheap money through government programs (TALF etc.). Spreads for mortgage backed debt have collapsed however faster than most trusts could get their funds to work and that in conjunction with their relatively high management costs makes the operating model for these entities unattractive, imo. I think they now try to cater to yield pigs that mix up yield with Return of capital.