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Nobody could have seen it coming...
Tanta:
How much dry powder do the GSE have? Werent they sheddding retained portfolio because the regulators said they had to limit their size?
Perfect Containment!
Ther Dow will be 400 today!
WOW. And in a rush to cover shorts it ran to $4.60 today. NOW, That's panic.
GOod riddance.
This is ridiculous. Who will give Americans their God-given birthright of free money and unlimited credit? Anyone? Anyone!?
{{crickets chirping}}
7,000 plus jobs -- POOOF!
Cal, yes. They were supposed to be limiting their size.
That's why I think it's a bit weird to be asking them to step in and buy up private issue MBS to prop up the private secondary market in Alt-A paper. That is not the market they are mandated to provide liquidity to.
OHFEO just told them, by the way, that they have to hold ALL originators to the nonagency guidelines, not just the ones who are regulated depositories.
I can't see them turning around this week and buying up a bunch of Alt-A paper so that IndyMac et al. can have something to put on their rate sheets.
Tanta,
Rgr, I thought you meant they had dry powder, just dont mind me this viscous cycle is making me lube my mind.
Hey, Perry says the GSEs called him, not the other way around...
I know the feeling, Cal. Try eating a pare.
Hey, Perry says the GSEs called him, not the other way around...
Does he? He says Dodd called him, but the calls with the GSEs are a little more ambiguous, aren't they?
I received a call from U.S. Senator Dodd this morning who seeking an understanding of what is really going on and how can I and Congress help? I also have talked to the Chairman of Fannie Mae this morning and have traded calls with the Chairman of Freddie Mac (Fannie Maes Chairman telling me that they are prepared to step up and help the industry).
I remember back in, what, February? when Syron said Freddie was willin' to stand up and help the subprime industry. Then they all puked when they heard the terms under which this help was available.
Does this tie in with ABX posting 18/20 new lows (and just a gnat's eyelash off of the two that were not new lows)...
Some of those "AAA" plots look like... the CLIFFS OF INSANITY!
Does this mean the fasbi couldn't help them?
i don't know, what am i, an english major?
I guess the rating companies will have to downgreade AHM again -- like to a Watch Negative?
And maybe take AHM off the preferred servicers list?
PS Tanta, i thought u detectives were supposed to be looking for your next victims, not parsing language in emails about the secondary mortgage market...
Expired
Fitch Downgrades AHM's Servicing Unit
Thursday August 2, 4:52 pm ET
Fitch Ratings Downgrades American Home Mortgage's Servicing Operations to "RPS3-"
I wonder what the job requirements are to work for Fitch.
Perhaps the phrase "fog a mirror" isn't dead yet!
It is with great sadness I announce today that American Home Mortgage has been forced to close. Unfortunately, the market conditions in both the secondary mortgage market as well as the national real estate market have deteriorated to the point that our business is no longer viable,
AHM CEO Michael Strauss in email to employees today.
Sad day for 7,000 employees of AHM.
Best to all.
I'm more bearish on housing than anyone I know....and this along with the Indymac letter is worse than even I expected.
bring out your dead
Couldn't have happened to a nice bunch of sleazy crooks.
I take it that this news is a tree falling in the forest of prosperity that is the United States.
Or, perhaps, it can be explained to me why it isn't.
I'm being serious. It seems pretty ghastly to me. But I don't see people jumping out of buildings.
Couldn't have happened to a nicer bunch of sleazy crooks, that is.
The funniest line I have seen in a long time appeared at 12.06 pm (PDT) on Bloomberg:
AMERICAN HOME MORTGAGE SHARE FORECAST CUT TO $0 AT FRIEDMAN
Real Estate Blog - PMI Companies Pulling back on issuing PMI to sub 600 FICO
At least one major insurer issued a statement today they intend to suspend issuing PMI certificates to borrowers with that fall within the folowing guidelines;
"As a result of the performance and recent changes in the industry, it is necessary to make the following changes for mortgage insurance applications received on or after September 17, 2007
Loans with LTVs greater than 85% with credit scores less than 575 are ineligible for mortgage insurance, regardless of the DU or LP recommendation.
All ARM loans with LTVs greater than 95% with credit scores less than 620 with a first rate adjustment of less than 5 years are ineligible for mortgage insurance (for example, Pay Option ARMs, 1/1 ARMs, and 3/1 ARMs).
Until further notice, we will temporarily suspend insuring all loans with LTVs of 97.01% and greater with DU recommendations of Expanded Approval Level II and III, and DU Refer with Caution."
I believe this blog is helping to document an important metric of U.S. economic change, but maybe only 1% (or less) of all readers can see it. It isn't even real estate-specific.
The question is...what is the key difference between a vast and dynamic manufacturing-based economy and a vast and dynamic service-based economy. My hypothesis is...the service-based economy is far more fluid and vulnerable to catastrophic change and job loss.
There has never, ever been a vast, dynamic service-dominated economy like the U.S. is today. We don't know how it functions. But I believe this type of economy creates and destroys jobs on demand, virtually overnight. If LEND and 7,000 jobs going POOF in a day don't demonstrate that, I don't know what does. I think mortgage lending is just the first of many service-oriented economies that will experience the same POOF effect, in sequence. In fact, it might be everyone except the lawyers.
How many jobs going POOF does 100+ busted mortgage companies represent? And how many of those jobs were destroyed overnight, with virtually no benefits? It's a whole new economic dynamic...and we're living it.
CNNMoney.com: 404 Page Not Found
Countrywide Comments on Its Strong Funding Liquidity and Financial Condition
""Our mortgage company has significant short-term funding liquidity cushions and is supplemented by the ample liquidity sources of our bank," Sieracki continued. "In fact, we have almost $50 billion of highly-reliable short-term funding liquidity available as a cushion today. It is important to note that the Company has experienced no disruption in financing its ongoing daily operations, including placement of commercial paper."
a reuters post on ahm:
American Home Mortgage to close Friday: report
| Reuters
reuters re abx sell off to record lows:
Thu 2 Aug 2007 4:11 PM CDT
By Nancy Leinfuss
NEW YORK, Aug 2 (Reuters) - Liquidity fears fueled a massive sell-off in the benchmark ABX indexes on Thursday, sending them plunging to record low closes as credit concerns intensified, traders and investors said.
The series of subprime mortgage indexes, used by investors to hedge their subprime mortgage risks, fell precipitously by four to 15 points across the credit spectrum before easing back to finish at record lows, traders said.
"The market has essentially seized up over the last half hour. We saw bids on the screens drop 10 to 15 points and liquidity vanish" just before the close, said one market participant. "There were lots of rumors flying around about liquidity squeezes, but nothing substantiated," he said.
The ABX "BBB-" 07-1 series, which is tied to loans made to risky borrowers in last year's second half, was quoted at a 28 to 40 wide market before ending the session at a record low 35.63. It was well below its recent record low close of 37.72 last week.
The index has fallen more than 60 percent this year as delinquencies and defaults began rising as the U.S. housing market stalled.
The ABX held near unchanged levels earlier in the session despite a statement by subprime lender Accredited Home Lenders Holding (LEND - news) that bankruptcy was a possibility. But it began weakening after bond insurer MBIA said delinquencies are rising on subprime home loans serviced by Countrywide Financial (CFC - news).
However, rumors that a large firm was unable to roll over its commercial paper due to credit issues sparked the sudden massive sell-off in the indexes late in the afternoon.
"There was a freefall after rumors surfaced that a large institution could not roll over its CP (commercial paper). ABX recovered some after the bottom fell out on the rumor," said one portfolio manager.
Institutions use commercial paper for short-term financing with terms running anywhere from one day to nine months. The financing is based on an issuers' credit-worthiness.
Even the highest-rated "AAA" 07-1 index slid below the key 90 level by as much as four points, to 88. It later recovered a bit but closed at a record low 89.69 versus 92.11 on Wednesday. The "AA" index plummeted five points to a record low close of 72.28 versus 77.61 in the prior session, investors said.
german bank with billions of subprime exposure:
Germany's IKB has $24-bln subprime exposure-source
| Reuters
I think that as this plays out, it is getting harder to live in denial. The hardest part of this whole story is knowing that we are still in the early chapters of a housing nightmare.
It's worse than a housing nightmare y.s.
It's a credit bubble of ginormous proportions. And yes, we are just at the start of the deflation of that bubble. US residential housing will be but one of the victims. The true test of valuations (of various asset classes) will come when the first part of the decline feeds through to consumer spending and then the job market. Once final demand takes a real hit, it's anyone's guess as to how bad it gets. Hard to imagine but we are just seeing the start of the unwind.
I suppose Mizilo will be imminently contacting the best of the 7,000 employees.
By the way, how many of these mortgage jobs have been cut in SoCal this year. Anyone hazard a guess?
rich,
I like the service economy analysis. I like it a lot.
It almost makes me think that infinite leverage is a bad thing.
Rich, that seems plausible.
The one thing I hear over and over again about the economy is that we are in uncharted territory. I recall from the history books that a lot of Explorers of uncharted territory didn't make it back home.
Didn't a lot of those explorers get topless native girls? At least we should get that.
I am writing from memory so correct me if I am wrong:
In the conf call just two weeks ago CFC said they have $90B in available funding. Today PR say $50B.
so have they lost 40/90 of their funding ?
They also say they fund about $3B per day in 2Q07 so they have left enough for 16-17 working days ?
Is that a normal cycle ? I though lenders should have more to cover a 6 weeks cycle at least.
NTAP warns - Citing weakening trends in financial services firms.
Hello,
From Brokers Outpost: They also had a message the Fieldstone Mortgage is shutting down. I liked it as it was simple to read.
This is from Countrywide
I know yesterday I sent out a pretty simple (yet informative, right?) email as to what is happening in our market, but that was more directed to the good old stocks and bonds. I would like to shed some light on the bigger picture, our current lending marketplace. You have all seen over the past few months banks go under. Over the past few days, a few other banks, prime and sub prime, have frozen their pipes, and their future remains uncertain. So what is going on you ask? I am going to keep this simple. Essentially, some banks are facing what we call a liquidity crisis. This means that they are holding loans on their warehouse lines, they cannot sell. Or at least sell them at profit. (A warehouse line, is like a gigantic credit card, in which banks fund their loans on, and then sell them off to the investors in bulk) So when these banks are stuck with millions of dollars of un-sellable loans, what are they to do? Take a loss, and get them off their line. This loss often times is what shuts doors down on banks overnight. Now, when you see banks freeze their pipes, they are essentially stepping away from the chess table, thinking and analyzing how to react to the situation they are in. Sometimes they dont have a play to make, and walk away for good. Make sense?
As for pricing you have all seen rates skyrocket. And not follow any correlation to the bonds. Here is why... The price tags on certain products, (arms, pay options, secured pay options, alt a, etc), are tied to certain risk factors. The risk factor has increased recently, and this is due to the increase in defaults. Investors are demanding more return / higher yield for the increase of risk they are taking on. Thus, higher risk = higher price. What was once a monthly, or weekly, bulk trade / sale, is now happening almost overnight, which is why you see huge rate increases overnight.
With all this said, you will see products that you have taken for granted, GO AWAY. Stated income. Pay Options. No Ratio. No Doc. And some banks already have done this.
Where does this leave you and me? In a tough place, that is for sure. But, this is what will separate those that were in this for a quick dollar, and those that have committed to this industry for the long haul.
Although I cannot guarantee a timeframe for how long any of our product will be around, we have it now, we are owned and backed by a very very large bank, which enables us to battle these issues that are folding smaller operations down.
This was great. It gave me a chance to show my wife in realtime what a dead cat bounce is. (I didn't play it - I just showed it to her.)
Fitch Affirms $886.9MM & Downgrades $68.3MM From 1 New Century Subprime Deal
Fitch Affirms $886.9MM & Downgrades $68.3MM From 1 New Century Subprime Deal
Fitch Affirms $6B & Downgrades $797MM from 9 J.P. Morgan Subprime Deals
News
Now management can concentrate on defending themselves full time from the class action lawsuits.
I unfortunately, lost much of my investment capital on AHM. Although I understand that even the honest mortgage bankers are struggling, I think managements handling of the crisis illustrates a wholesale lack of ethics.
Management didn't disclose anything of substance until American's defaults were already a fact and out of the bag. I kept putting more money in over the last month thinking that the market would stabilize- I was obviously wrong and AHM has certainly added to the instability.
Management's failure to disclose the companies downfall has also caused a lot of damage to innocent bystanders in addition to its shareholders and employees.
American supposedly had about 1.2 billion in shareholder equity (about $20 per share) at end of the first quarter. The June 28, release stated that figure would go up when they reported for the 2nd quarter. (They never did report for the 2nd Quarter and, now that I have analyzed it, the only way the statement about shareholder equity increasing could be true is becuase the company managed to get 200 million in new equity from stock sales in the second quarter). Therefore, presumably, if AHM had not been cooking its books, it should have been able to shut down its orgination business, declare bankruptcy, sell its assets in an orderly manner, pay all its debts, and, hopefully, have something to distribute to its shareholders. It might have even been able to continue its servicing business as a profitable going concern.
Instead, management hide the problems, blew through all its liquidity and even exposed the company to more liabilities in the meantime. For example, since the stock was heavily shorted, millions of dollars changed hands from shorts to longs on July 26 the date the dividend was supposed to be paid. The real kicker is the many of those millions were automatically reinvested on 7-26 at 10 bucks and some change. I assume that AHM is now exposed to pick up the tab for the millions that will be lost unwinding the reinvestments at a buck and some change. Ditto for the failure to fund loan closings this week. Every prime borrower will have a claim for at least a few hundred dollars to change lenders, the Alt A borrowers may not be able to cover now and have some serious monetary damages to sue AHM for. These claims alone will be many millions of dollars in damages that didn't have to happen. These two classes of claims could have been avoided with forthright and honest disclosures by management. Finally, the class action suits. The way the demise was concealed certainly adds fuel to that fire.
I see no chance of the shareholders getting anything out of the wrap up. Well, at least I have a enough left to pay my mortgage and I am young enough to learn from my mistakes. Hopefully most of the employees will lend on their feet too.
Arronic typo. I meant to say "land" instead of "lend" in may last line.
Will!
"Hopefully most of the employees will lend on their feet too."
Haha - "lend" on their feet?
Not if there's something viscous on the Freudian landing...
Interesting...Unilever is cutting jobs, also saw that Nestle CEO is very bearish on the economy.
Is is reaching into consumer goods or these companies just batting down the hatches for the rough waters ahead?
"Unilever, the maker of Dove soap, Vaseline cream and Knorr soup, said Thursday that it plans to cut 20,000 jobs over the next four years to speed up a recovery program aimed at narrowing the gap with Procter & Gamble. "
Regards,
Aah, kind of you to say so. Brings a tear to my eye and makes me want to send a modest check to the endowment fund at my alma mater so they can keep churning out more.
It makes sense if you think about it. When the entire economy is based on ripping each other off, pretty much everybody should be a lawyer.
Q: Who is to blame if prisoners get up and simply walk out of prison?
A: The authorities in charge
Q: Who is to blame for the mortage mess and the carnage that will unleash on out society. (Take greed out of it since greed is pervasive.)
A: ""
Kett82, they see the writing on the wall. It's best to get ahead of the curve in this case. Since they are doing it, and others are doing it as well, in due course it becomes a self-fulfilling prophecy. It only takes businesses to switch their expectations and start cutting back to feed through to consumer demand and ultimately create just the situation they feared. Funny how that is.
I'm sorry Latenight, I thought your post was a secondhand quote from an AHM employee, not an actual post from an AHM employee.
...I shouldn't make light of your situation.
You've had an experience which I'm sure most of us have had to some degree or another: being so close to a problem that you don't see the problem.
Good luck going forward.
Rich
Basically the mortgage companies have funded their own demise via Wall Street. The impact on the service industry goes far beyond the employees of the individual companies and impacts attorneys, surveyors, appraisers, home inspectors, insurance guys, even the termite man. The REALTORs and builders are getting their rewards also. The industry has always had enormous pressure to get the deal accomplished, with the thought that everyone wins. The moral hazard seeps in when those that have something to gain start dictating to those lending the money. The absence of honesty and integrity in the industry is widespread and the government fails when trying to regulate these basics of sound business. Wall St. is finding game over along with excess profit breeds ruinous competition.
DR
Having worked for a lawyer for the past 20 years I can tell you everytime the economy gets bad, the lawyers get busy. They're getting busy. In fact I've seen MBA's applying for secretarial jobs.
Thanks for the thought. I was a shareholder only- not an employee. I still have my day job. In fact, I will probably have it for another year than I was planning on thinks to AHM. (My retirement is a little further off now.)
I can believe the equity market keeps going up with this carnage in the bond market???
This would have been forecast by a substantial decline in the equity market in the past, now it doesnt even go down in the midst of it.
The emperor stands tall while Rome crumbles...
My hypothesis is...the service-based economy is far more fluid and vulnerable to catastrophic change and job loss.
ayup. Thing is, a service-based economy is essentially redistributing wealth, not creating it.
Somewhere, sometime, somebody's got to be pulling ore out of the ground, harvesting the trees, milling the corn, bagging the concrete mix.
Kiting checks to China only lasts for so long.
If there is any justice in this world, Quicken Loans will be the next entry on the implode-o-meter.
They are still running deceptive ads on the radio claiming that "due to the recent housing slowdown, the Fed has left rates alone. Therefore mortgages rate are still near alltime lows."
What kind of non-sequitur is that? If I hear their deceptive ad on the radio one more time I'm gonna hurl.
I'm sad for all the people that are losing their jobs but greed has its' consequences. Maybe they'll move on to better pastures. Somehow though I have a sick feeling that the CEO and his cronies dumped their stock last fall.
can anyone comment on the filing of annuals from LEND?
What am I missing.... let's think about the past week for a minute. Friday night , AHM gets the ball rolling with their dividend yo -yo . Then we find find out over the course of this week that apart from two BSC hedge funds declaring bankruptcy , a third BSC fund has locked out redemptions to investors ( a fund with no real leverage and no real subprime exposure to boot. ) During the course of the week , we hear IKB of Germany was the recipient of a 3.5 billion euro bailout-- just in case your keeping score at home , that's about 40 bigget than LTCM's bailout. And keeping with the genre and the apparent playbook , we had an LTCM forced cooperation style for the German Banks -- with really no intelligent discussion in the mainstream media about this event. ) ... By the way , the way the total bailout was about 5 times their ( IKB's ) market capital so what kind of leverage were they working with any way ? ? Following on , AHM gives up the ghost , throws in the towel and 7 thousand employees are summarily dismissed..... So , help me out , why are the markets up ?
fredw, the problems are contained.
fredw, because they can.
Besides, the markets are down from a few weeks ago. Perhaps we are on long slow march to the bottom.
Dear Geoff,
I think you are right...I've read about it, but it is odd to see it in action.
No wonder all the shouting about containment.
What's the saying...a recession is when your friend loses their job and a depression is when you lose your job.
Best regards,
AHM insiders net buyers in the past 6 months; only one big (single sale) in the past year...and a couple small sales...
AHM Insider Trading - American Home Mortgage Investment Corp - Form 4 SEC Filings
Compare to Mozilo:
Insider Stock Trades - Countrywide Financial Corp (CFC)
CFC insider sales are incredible...
But seriously folks.... did anyone take a peek at the ABX and CBX today ? Do things look like they're getting better when AAA goes for about 92 ? Ignoring a problem doesn't make it go away ... and the problem is getting worse not better.... and by the way , I've also heard there is a fourth BSC fund that has problems.... but is that a surprise , really ? Anyone in this space that wasn't short ( like the Paulson fund or Pequot Capital , or DB , has a problem right now. ) I don't presume to be telling anyone here things we don't already know by the way.... that's why we're here. Just verbalizing , that's all.
LEND?
Be patient with me... let's consider IMB's CEO ( the previousl unflappable Mr. Perry's -- who seems to be in melt down mode these days ) statement for a minute.... I had to travel , so I'm catching up on stories folks here have already parsed. Let me digress... "IMB CEO says mortgage markets are panicked and illiquid AAA MBS bonds are difficult to trade." So , if you have a private secondary market that is too scared to trade a fricking AAA bond ( I'm referencing the Calulated Risk from earlier today covering this subject -- as a source ) , how can the market go up ? That's insane. What the heck is going on ? Ignoring horrible news doesn't make it go away. But I guess the former employess of AHM would problem say amen to that point .
It's a bet that this is going to be settled via dollar depreciation, more than anything else.
Anonymous | 08.02.07 - 8:03 pm | #
That'd be me.
Napolean , actually , they can't play their game much longer. Ask the former AHM employees. And , it won't stop there, it will continue , won't it ? See , we can create phony statistical data to indicate everything is fine... but those AHM former employees know that doesn't tell the real deal. Macromedia ( the firms that works with ADP on their job report ) essentially came out last month and said the Government numbers for jobs was a complete fabrication , which of course it was. Does anyone who has been brathing air over the last 6 months believe we are created any jobs in manufacturing and construction in July ? How about June or May ? C'mon !
What I'm concerned about is a lack of credibility. My view is that the old school concept of investing is kaput. Let's just admit we're all riverboat gamblers... how many folks here prefer options to buying the actual stocks any way ? ( rhetorical Q .) But at some point , you have to have some faith in something. When you can't give credit to the the numbers from the government , when you can't judge the value of a security , how do you really trade ... aren't you just betting on red or black ? And when true risk is not discounted , what are folks really doing ? I'm still trying to figure why a 5 billion dollar state - directed ( in true LTCM fashion ) bailout didn't ruffles feathers this week. That's all... thanks for the patience b/c I don't get it. That makes me believe things are far worse then we understand them to be.
Thanks, inquiringMind.
That Mozilo sure is a piece of work. Wonder how many daytraders are licking their chops lookin' at that CFC chart.
And how many of those jobs were destroyed overnight, with virtually no benefits? It's a whole new economic dynamic...and we're living it.
Can't you sense the almost boiling blood?
If anyone wants to be a Stock market investor, he must learn patience. I am not talking about buy-and-hold, I am talking about short-and-hold. Patience everyone, we have 15% more to go, DOWN. The market is not gonna give anyone a free ride. You have gained the knowledge necessary to be successful by reading this blog, Now all you must do is ACT.
Tell me about it. I sold my LEN 30 puts on Tues., got too conservative with my stop loss strategy. Should have held them, would have made a killing the next day when the Beazer rumor hit.
Bought some more HB puts on the "dips" today, though. Gonna hold them babies ...
"What I'm concerned about is a lack of credibility. My view is that the old school concept of investing is kaput. Let's just admit we're all riverboat gamblers... how many folks here prefer options to buying the actual stocks any way ?"
fredw...used to be the typical stock market customer was someone who was very rich and traded sensibly. Today, it has been taken over by day traders trying to make 43 cents, huge funds like CapPers that make massive bets trying to CYA for the quarter.
So maybe the market is moving independent of reality - and maybe motivations to trade are not based on opportunity but by necessity.
Oh yes we will never have another bear market. Yea right, you just go ahead and trade out of necessity.
DH is right; have patience with your shorts.
fredW-the mkt is meant to confuse. if it went straight down everybody would make money now wouldn't they? the big institutions and banks that have large positions in housing need time to unwind. if they sold everything at once they would attract attention attracting all the sharks sending prices into freefall. a great example of this is happening before our eyes with the abx index. whats really happening behind the scenes that few talk about is all the holders of cdo toxic waste know their positions are worthless. what they've decided to do to save themselves is short the index to partially offset long cdo losses. this is a self defeating strategy and will only work to a degree before they implode. the domino effect has begun.
"The absence of honesty and integrity in the industry is widespread and the government fails when trying to regulate these basics of sound business. Wall St. is finding game over along with excess profit breeds ruinous competition."
Pretty simplistic explaination.
Compare with the loss of manufacture job and telcom bubble burst, the loss of mortgage company is fairly small.
Both positive and negative effects of a single manufacture section is much more broad than a service section, because manufactures are often have many sections that serve their needs.
Because service based economy lacks the pyramid structure, any effect should be more easily absorbed or contained. It is not an unchartered water, it is the " Brave New World" where society reachs its equilibrium and intellectual sterility.
"Compared with the loss of manufacture job and telcom bubble burst, the loss of mortgage company is fairly small."
Not when real estate accounts for nearly 70% of the US economy!!!
More credit market problem:
Union Investment Halts Redemptions From Bond Fund (Update4) - Bloomberg.com
Rich, Arbogast, Troy - one more ditto on the service economy thing...at some point you have to have value-added production, not just skimming of money velocity.
I'm surprised by Unilever - people need soap and toothpaste, just like they need lawyers and coffins, regardless of the economy. Perhaps it's time to reconsider holding P&G.
KnotRP - that's my bet too...we have always dealt, as a nation, with these things by inflating them away. This time will be no different.
CEO gets a convenient margin call to use as an excuse as to why he sold most of his stock on the 1st:
Error Report
Read the fine print. Supposedely, the sale was a margin call. How conveninient! Also, the Chief investment officer quit on July 27, 2007 without any notice and the company forgot to mention that in its previous filings!
There are already numerous class actions pending.
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