p.s. Why is everybody so pessimistic lately? I am not implying the bottom is near; it's just too much negativity is unhealthy. We have survived previous recessions; we will overcome this one as well.
Also stating that the US by GDP/capita will be in the top 10 (or close) within the next 50 years sounds like sure bet.
The FHLB has advised us that it has changed its position regarding collateral held by affiliates, and that $736 million of pledged collateral from our affiliated REIT may not be fully eligible to support borrowings.
Looks like somebody got caught with a shady mark to model valuation.
Is something wrong? You just haven't been yourself lately. This past year has been rough for everyone but you seem to taking it especially hard. Let me now if I can help.
This weekend I was wondering if the lack of bank failures so far might also have something to do with the complexity of the banking system.
The last time we had a major wave of failures, there was basically no internet, debit cards were less common, and in general it was a lot harder to move your money around quickly.
Combine that with an understaffed FDIC which has struggled to retain the old timers...if I were them I'd definitely want to start with a few smaller banks first.
This is another reason they'd want the Schumers of the world to keep quiet (not saying he should have, just another perspective).
Combine that with an understaffed FDIC which has struggled to retain the old timers...
Banks are also reclassifying their loans like wells Fargo did and kicking the loss can down the road every quarter. Banks are waiting out the market like everyone else.
FDIC gonna be doing the Friday night blanket party for those folks, pronto.*
How soon can we push that IndyMac crap onto the skeleton team so we can take down the next big ones to go?
WAMU is also circling the drain.
That three and half buck chuck share price predicts less than three months.
That really is a whopper that will shake the markets.
Someday this war's gonna end...
*Nothing in this free blog post should be construed as implying that the fdic, ots, ncua, or any other government agency will manage to kill another zombie bank in any given timeframe, all speculation is simply the author's mad ravings, that have, in the past proven to be a bit like the ravings of Cassandra talking about the events of a certain greek unified war endeavor-glta!
In a prior thread, mailgilbs wrote:
It's not "catching a falling knife" when your investment horizon is 30 years and you're not trying day-trade during a bloodbath. I said I was young, not stupid.
mailgilbs | 08.24.08 - 5:36 pm | #
Mailgilbs,
I'm also new to this site, but I'm not new to investing. Your investment horizon is 30 years; that's only a few years longer than I've been trading. Oh, I had a career too, and a family and enough of the other little things in life that jump in and interrupt one's well thought out market positioning to make it interesting. As I read through the entire thread in which you made the above post, I could not help but ask myself what advice I might offer "off the cuff".
Here it is: the most sage investment advice I ever received: the Buddah Principle. Simply stated, that principle is that only you decide. As important as it is to understand the investment world, the rise and fall of the market, the business cycle, the sector cycle, bull and bear markets, and as important as it is to listen to others views of what is happening, it is more important that you understand who is making the investment decision. There is only one person who holds that power, and that is you.
In your 30 years, you will see as many market shifts and changes as I have. You will catch and miss just as many as I did. Through it all, you will hear many "informed" opinions. You will come to recognize that the vast majority of those seemingly smart folks were just flat wrong.... as it subsequently turned out. You will also find that a frustratingly large portion of the seemingly logical and {worse} trustworthy advice you receive will only have encouraged you to buy/sell for the sole purpose of enhancing the personal profit margin of the person who gave you the "hot tip" long after the opportunity for you to profit has gone. A few of those voices will educate you; but not very many. Through it all, there will only be one person who pushes that buy/sell button.
For what it is worth, my "investment advice" is to invest in yourself. Learn. Granted, it is most difficult to learn how the market works when all the market rules seem to be changing. The good news is that the market is always changing. However, it is particularly difficult now, because.... well take my word for it just this once..... this time there do seem to be big changes on the horizon. In the past 50 years, the major indexes have only dropped by 20% in any six month time frame a total of seven times. Take your age, add 50 and estimate the number of times you will see this kind of change again.
If you took the advice you've received thus far in this thread to heart, you would logically invest in mass produced gold sheathed bomb shelters - - opps, that's real estate, so you've probably heard the advice that you need to be careful there as well. I'm new enough here that I can still insult people with impunity. On the other hand, I've been around the market long enough to understand that 20% of the humans in this country have consistently owned 80% of the wealth of this country for a very very very long time; THAT percentage really doesn't change much. With all the drama we face, it's actually very unlikely, that percentage will change now. Possible, but very unlikely.
In the end, my friend, you would not even be concerned about these "big deal" investment outcomes if you were a member of the top 20%. So, let's be real; we both wish we didn't have to worry about the 15% of the wealth that 80% of us share, but we have no other choice.
Clearly, or at least, in my humble opinion, we are looking at a very significant change in the market. I'm a trend trader. In my language, we are looking at a possible top to the second counter trend rally of a new bear market. Garbeldegook, garbeldegook, garbeldegook. Nevertheless, I have found a way to work with the market that makes sense to me. I'm not here to sell it to you. Indeed, if I can, I will take a profit from any error you choose to make.
Here is my market advice. Trust yourself. Trust noone other than yourself. Never - ever blame anyone other than yourself if a trade goes against you. Know from the start that you will make mistakes. Make them !!! That is how you learn. If you learn from me, you will always assume your current market view is at least possibly mistaken, and you will set aside market available resources {cash} as a buffer against the very real possibility that you were right, but moved to fast - or, heaven forbid, that you were simply wrong. Either way, if the market moves against your best thinking, it's very nice to have a handy fall back position.
Put another way, as my version of the Buddah Principle would have said, " Listen. Listen to all of the advice. Listen to everyone. Look at the facts you understand and explore the possibilities sage advice suggests. However, if and when you choose to risk; understand the verb; never ever take that risk without understanding that it is YOU - it is YOUR MONEY - that you place at risk, and, if you're wrong, that YOUR MONEY that is gone. There is great wisdom in the notion that the first rule of making money in the market is DON'T LOOSE ANY.
So, let me bring it back home.... if I had 30 years left to make money in the market..... I'd ask myself, is this really Armageddon or are these guy's hyping something ? Were it me, I'd bet that the rich are not dumb, but wadda I know ?
Re: well-placed sources within the bank, reported over the weekend that Fuld faces a planned coup that will force him out by year-end. The paper said operating chief Bart McDade, installed in June as Fuld sought to restore faith in the firm after a big second-quarter loss took Wall Street by surprise, has taken over many of Fulds responsibilities.
A slow motion plan to address a raging fire....???
"Whether the CDS market is accurately assessing the creditworthiness of Lehman Brothers, trading on August 20th at 376 bps, double the level in early May, will be the next test of its worth."
They will be the next "BIG"/"Regional" bank to fail. They've gotten in way over their heads with the NeGAmOptARMs based upon all the depreciating Florida RE that its just a matter of time. The booking of deferred interest as present income has always been pure fiction, but now its a harsh reality that must now be dealt with via a Friday FDIC takeover. Look for it on a scale similar to IndyMac, and sooner rather than later.
JPMorgan Holds $1.2B Of Fannie Mae, Freddie Mac Preferred Stk
Last update: 8/25/2008 12:50:54 PM
DOW JONES NEWSWIRES
JPMorgan Chase & Co. (JPM) disclosed Monday in a regulatory filing that it held approximately $1.2 billion par value of Fannie Mae's (FNM) and Freddie Mac's (FRE) perpetual preferred stock.
JPMorgan estimates that such preferred stocks have declined in value by approximately an aggregate $600 million in the third quarter to date, based on current market values, according to the filing with the Securities and Exchange Commission.
Such securities are held in JPMorgan's investment portfolio and are marked to market through the company's earnings.
JPMorgan said the precise amount of losses that may be incurred on these securities for the third quarter is difficult to determine, given the significant volatility being experienced in the market values of these securities.
"Please oh please BB save my investment in the preferred shares......"
Said the current board member of the FRBNY, and current CEO of JPM.
"losses difficult to determine"
but the gains on any reduced liabilities are reported as profits...
"Underpants-Nomes Profit Theory" is being played out in the market:
Step 1: Get Underpants (Stock)
Step 2: Shrug/Question Mark
Step 3: Make Profit (Write Losses booked as Profit).
Raising capital....>>>> Based on current market values, Mr. Gallagher sees AIG having to take a $6.5 billion write down, 1.5 times the amount he previously thought. That will decrease AIGs book value by a whopping 6 percent and could force it to raise capital to plug the hole in its balance sheet. Mr. Gallagher estimated that AIG will have to raise $7.5 billion in the second half of 2008.
Credit rating agencies are taking a hard look at AIG. Further deterioration in the companys earnings stream could cause the firm to be downgraded. The risks of a near term rating action have clearly risen, in our view, Mr. Gallagher wrote. In the event of a 1 notch ratings downgrade from both Moodys and S&P, AIG would be required to post up to $13.3 billion of additional collateral.
Raising that much money could be difficult in this credit environment.
AIG estimated a one-notch downgrade by both Standard & Poor's and Moody's, another credit rating agency, would require it to post up to $13.3 billion in additional collateral.
That could mean AIG would have to raise more capital on top of the $20 billion it recently raised. Credit Suisse's Gallagher expects the company to raise another $7.5 billion in equity capital this year.
lobal Investing Guru Jim Rogers on the Financial Crisis
The U.S. financial crisis has cut so deep - and the government has taken on so much debt in misguided attempts to bail out such companies as Fannie Mae and Freddie Mac - that even larger financial shocks are still to come, global investing guru Jim Rogers said in an exclusive interview with Money Morning.
Indeed, the U.S. financial debacle is now so ingrained - and a so-called "Super Crash" so likely - that most Americans alive today won't be around by the time the last of this credit-market mess is finally cleared away - if it ever is, said Rogers.
The end of this credit crisis "is a long way away," Rogers said. "In fact, it may not be in our lifetimes." During a 40-minute interview at a wealth-management conference in a West Coast Canadian city last month, Rogers also said that:
--U.S. Federal Reserve Chairman Ben S. Bernanke should "resign" for the bailout deals he's handed out as he's tried to battle this credit crisis.
--That the U.S. national debt - the roughly $5 trillion held by the public- essentially doubled in the course of a single weekend because of the Fed-led credit crisis bailout deals.
--That U.S. consumers and investors can expect much-higher interest rates - noting that if the Fed doesn't raise borrowing costs, market forces will make that happen.
--And that the average American has no idea just how bad this financial crisis is going to get.
"The next shock is going to be bigger and bigger, still," Rogers said. "The shocks keep getting bigger because we keep propping things up [and] bailing everyone out."
"They have not even taken a write-down on any of it:
"$1.2 billion par value of Fannie Mae's (FNM) and Freddie Mac's (FRE) perpetual preferred stock.""
That does not necessarily follow. They are stating the par value b/c the preferred dividends are based on the par value, not the market value. They may have written it down or not (not likely, yet, as they will prob. wait for quarter end).
Indeed, the U.S. financial debacle is now so ingrained - and a so-called "Super Crash" so likely - that most Americans alive today won't be around by the time the last of this credit-market mess is finally cleared away - if it ever is, said Rogers.
Thanks for the post but Damn! I wasn't going to bottom pick anyways but Damn!
"The next shock is going to be bigger and bigger, still," Rogers said. "The shocks keep getting bigger because we keep propping things up [and] bailing everyone out."
Selectively handing out money to the people and businesses who screw up the most has negative consequences?
This just sounds like nonsense conservative type thinking to me.
Why did I buy all that Fannie and Freddie preferred?!
I'm so smart! Just listen to the media! I may be the smartest man on earth!
No way that preferred isnt worth par. I'll call Paulson and Ben and tell them I'll fail if they dont guarantee it. They fell for my BS BS so this will be a walk in the park.
I am smart....
judging from some of the bolded text, those may be saddles or parachutes on their backs so it's kinda hard to tell (especially when you haven't a clue about how such things are usually worded!)
WTF! A WaMu banner add at the top of CR? Way too funny.
You do realize it is your moral duty to click on those? Because if anyone is going to benefit from the last WaMu pennies going out the door, it might as well be CR and Tanta.
I watch, and I listen..... but my read on the last hour or so of posts is that.... you are only fooling yourselves.... I wish you luck, but that is my read.
Just as long as they don't ask me to show up for the first 100 days in DC.
My wife would be p.o.'ed at my absence.
Most of the 100 day guys ended up staying for years as the crisis just kept going and going.
This is getting uglier and uglier.
How come oil has stopped dropping back to $40 like Kudlow imagines poosible if we drill drill drill?
I am starting to drift into the really bad feelings about the fall camp. Even an election can't stop a lot of the damage from dropping out of wall street balance sheets.
Or should we just start calling them imbalance sheets? I just took a look at Corus's latest filing- fully half their deposit base could be called "brokered deposits" or equivalent. They even acknowledge they lost money on them, so essentially they are buying capital compliance with hot money.
I need not look up the definition of par value; it's simple enough.
"We hold $x par value of preferred stock" does not mean that they hold that PS on books AT par value, currently. Maybe they do, maybe they don't, but it does not necessarily follow. If you find that one does, deductively, follow from the other, please explain it to simple, ol' me.
Cheaper than gas.
?Mason Suna
You are so lucky I had no coffee in my mug to spit out! Wamu is toast, but as you not the stock implies a 3 month life span.
Hey... All this BankUnited talk reminds me that we have a 'convenient' three day holiday approaching.
And for Wamu, its already been pointed out a convenient 4 day holiday approaches in November...
"Not in Jimmy Roger's lifetime, but hopefully in mine."
In the other part of that interview, talking about future prospect for Chinese growth (and how he's still heavy in China), Jimmy Rogers said "America at that time ['96 Olympics] had 270 million people. Chinas got five times as many people, and its a much bigger country geographically."
When an 'expert' makes a fundamently incorrect statement like that (China is, at most, 2% larger than USA), I wonder what other faulty assumptions go into his analysis.
I kinda understand why the media likes him. He has this Russel crowe thing. However people are waking up to the fact that this guy's shit smells just like everyone else's. Hope you enjoyed your time in the sun Jamie.
China is smaller geographically than the US and much of their land is taken up by desert and uninhabitable mountain ranges and elevations.
I may not know much about preferred stock but I know geography...
I'm also a frickin' genius.
DaddieMac -
Its funny, because I took a dump the other day and I thought it stunk. But Dennis Neale, whose head happened to be up my ass, said there was no smell whatsoever.
Desperate people need to take desperate measures. As I measure things, the posts here are only growing more desperate - claims to wisdom and "inside calculated knowledge" ... I'm "so" not impressed. Fully 1/2 of the "oh so smart people now" will be broke in a couple of months. I've seen this movie before. Good luck.
Mark Zandi has just become the latest disgusting shill to call a bottom in housing sales on Bloomberg. He just lied his ass off, proving that his scumbag Moody's overlords have turned him into a lying shill.
His entire interview was filled with more lies than even an experienced liar like Dick Bove would normally try to pull off.
The prefs are marked to market according to your post:
"Such securities are held in JPMorgan's investment portfolio and are marked to market through the company's earnings."
S&P goes on -29% tear 2nd Qtr year to year..Should be up in bizzaro world...
Yes, true. But more important is what S&P 500 earnings will do over the next 5-6 quarters, no? This is what forward P/E earnings are based on. And it's what all those statements about "the market being reasonably valued" are based on.
Here's what S&P thinks quarterly earnings will do YOY, based on their published bottom-up estimates:
Libor Signals Credit Seizing as Banks Balk at Lending (Update2)
(money quote 4 para down)
"The premium banks charge for lending short-term cash may approach the record levels set last year, based on trading in the forward markets, where financial instruments are sold for future delivery. Back then, concern about the health of the banking system led investors to shun all but the safest government debt, sparking the biggest end-of-year rally for Treasuries since 2000.
These problems going into year-end are likely to be worse this time round because of the amount banks have to refinance in December,'' Thomson said, citing a figure of $88 billion.The suspicion is that banks are still hiding losses. The banking system relies on trust and at the minute there quite simply isn't any."
"Well, JPM may have lost $14/share on the FNM preferred"
How do you figure? JPM has 3.44B shares outstanding, so even if JPM bought it all at par (possible) and wrote it down to zero (possible soon), it's still only about $0.35/share.
$14/share would require a $48B+ investment--which is also possible, but not indicated by the 8-K. At least a couple of FNMA series of preferred are "no par", so the "$1.2B of par value" may be misleading, except that lying on an 8-K can lead to criminal sanctions and fudging that way is asking for a lawsuit.
I may not know much about preferred stock but I know geography...
I'm also a frickin' genius.
Yes so I've read loved the covers you did for all the magazines. China has a major problem. Trying to put 1 bill people to work while also trying to lead in technology ie automation. Good Luck with that
Sparks-
RE: Desperate people-I would look to homeowners who bought at peak, loved to heloc and purchased in sacramento valley, inland empire, los angeles, OC, san diego, East bay, reno/sparks, las vegas/henderson, phoenix metro, all of florida, atlanta, boise, tucson, denver and you might add other cities if you so wish...
My wisdom is shot but my common sense seems to serve me well and right now you seem to be preaching louder about something you feeling, not I or other posters..
cheers and good luck to ya in these desperate times..
It's their statement...not mine. I take that they, in fact, do hold it at par since how would that be any different than holding billions of dollars of crap at .90 when transactions have occurred at well below that value.
"Desperate people need to take desperate measures. As I measure things, the posts here are only growing more desperate - claims to wisdom and "inside calculated knowledge" ... I'm "so" not impressed.
you hurt my feelings
but hey i'll let ya make it up to me
where's the smart money going, give us one prognosticatio
"Such securities are held in JPMorgan's investment portfolio and are marked to market through the company's earnings."
And what is not said is that they are currently experiencing a complete and total lack of inputs in mark to market, so they say. Anyone that believes they are using real input on earnings releases, and more importantly these valuations, needs to have there head examined.
Why all the need for alphabet soup auctions if these things are truly marked to market and not fantasy??
Uncle Ar -
Include Puerto Rico and the other US territories and you'll see that I am right without dispute (as per usual). Since most of China is simply made up of "territories" (some of which would prefer not to be - ie Tibet which aint exactly small) why not include US territories.
Dont mess with me. I'm smarter than every other bank CEO combined.
Also, Jim Rogers is wrong and a blowhard. I've never heard anyone kiss his ass like they kiss mine and he was a dumbass to claim that China is "much bigger geographically" than the US.
I rule and I'm never wrong.
These preferreds are money good too.
You'll see.
Okay, get you now. Yes, saying basically the same thing--you in a bit more shorthand. Yes, they are intending to record a $600MM+/- loss on GSE pref in Q3-08; it has not yet been reflected.
I'm too lazy to figure out the following--was FNMA pref trading near par or at a premium in 04-06? If near par, then JPM bought after it began to slide in price, as it's down about 75%, rather than ~50%. This seems likely, as that explains using par rather than investment amount--$600mm loss on $900mm invested is a lot uglier.
The entire 8-K sez:
"JPMorgan Chase & Co. disclosed today that it held approximately $1.2 billion par value of Fannie Mae and Freddie Mac perpetual preferred stock. Such securities are held in the Firm's investment portfolio and are marked to market through the Firm's earnings. The Firm estimates that such preferred stocks have declined in value by approximately an aggregate $600 million in the third quarter to date, based on current market values. The precise amount of losses that may be incurred on these securities for the third quarter is difficult to determine, given the significant volatility being experienced in the market values of these securities."
So every G7 economy is now headed toward recession. Other smaller economies (mostly the new members of the EU, which all have large current-account deficits) risk a sudden reversal of capital inflows; this may already be occurring in Latvia and Estonia, as well as in Iceland and New Zealand.
This G7 recession will lead to a sharp growth slowdown in emerging markets and likely tip the overall global economy into a recession. Those economies that are dependent on exports to the US and Europe and that have large current-account surpluses (China, most of Asia, and most other emerging markets) will suffer from the G7 recession. Those with large current-account deficits (India, South Africa, and more than 20 economies in East Europe from the Baltics to Turkey) may suffer from the global credit crunch. Commodity exporters (Russia, Brazil, and others in the Middle East, Asia, Africa, and Latin America) will suffer as the G7 recession and global slowdown drive down energy and other commodity prices by as much as 30%. Countries that allowed their currencies to appreciate relative to the dollar will experience a sharp slowdown in export growth. Those experiencing rising and now double-digit inflation will have to raise interest rates, while other high-inflation countries will lose export competitiveness.
Global recession in the works, no refuge anywhere.
Hey Dimon,
You're a punk. I may be a little shit but I could kick your sorry ass. Just name the time and the place and remember to bring your $80 trillion derivatives portfolio with you. That's assuming you can find it underneath all that Fannie and Freddie preferred and the crap that Jimmy Lee talked you into putting on your balance sheet.
Mr. JPM CEO:
So Puerto Rico and others get representation in Congress (Non-voting doesn't count)? Just asking.
I guess if we included the 'disputed' area of Iraq the U.S. would certainly be larger.
This is confusing. If we are to raise capital while yields are falling and thus increasing our cost to borrow, will we have to borrow more money?
How does this impact retained earnings and dividends, and then, treasury stock is valued at its repurchase price and not its issue price, thus, its value must be apportioned over stock and retained earnings and then these matters of accumulated losses or gains that are listed below the balance sheet that have not yet been reconciled through the income statement. Then we have Level 3 shit, which for all accounts is some kind of spiritual entity that morphs around like cloud formations -- so you have to factor that cloud into future value and shit, who cares?
Rogers -
I have chunks in my stool bigger than you.
How's all that gold treating you the past month?
Investment Biker? More like investment loser.
Marry someone old enough to be your daughter next time. Also, a trophy wife is suppose to be goodlooking you Smurf.
Fuzzy Guru:
Say that again - just to convince me that you are posing an honest question - this site has a devastatingly nasty level of sarcasm - but I'm new here and capable of honest discussion.
Uncle Ar -
Yeah right.
And all of China has a voice in their government.... If thats the standard then China is about the size of Staten Island.
What voice does Tibet have in the PRC?
Again, I'm Jamie Dimon.
I'm awesome.
"losses that may be incurred on these securities for the third quarter is difficult to determine, given the significant volatility being experienced in the market values of these securities."
There is nothing "difficult to determine" since the share price today is severely lower than when these securities were purchased. Yes I am making an assumption however they are making the same assumption about input pricing on current valuations simply because that's how the game is played.
Cloaking it in regulatory BS is all I see going on here.
To Mark S., it is not a weird market if you are short financial and long commodities. If your longs are doing poorly, you dump your longs and buy your shorts to meet a margin call. Either way, it looks like I made the right call to dump everything except my defense stock last week. I got greedy and lost my 6% gain for the year. I expect to finish with a 3% gain but at least I will not lose money.
termination of the option ARM loan program;....termination of reduced and no documentation loan programs; reduction of the portfolio of negative amortization loans;
Why are any of these still being done by anybody - especially anybody who is under Federal regulation? Hasn't anybody learned anything yet?
Jamie Dimon writes:
Uncle Ar -
Yeah right.
And all of China has a voice in their government.... If thats the standard then China is about the size of Staten Island.
"Why are any of these still being done by anybody"
Option ARMs are returning whence they came--as a wealth management offering for HNW individuals with lumpy income. And, as before, the banks will accept pledges of financial assets in lieu of down payment requirements. They're useful in their place--that place being the genuinely wealthy, not the house flipper.
I'll give you a banana once the pump amounts to something more than what currently looks an awful lot like noise.
I was expecting something a bit more impressive after the wild sell-side RSI plunge the SP500 took as lunch hour was starting. Still an hour to go. Rally into the close...? I dunno. Coin flip at this point methinks.
Given all the problems with Option ARMs and stated income (liar loans) that first appeared around March of 2007, why hasn't the OTS and FHLB simply banned these types of loans at regulated institutions? Why wait until an institution is on its last legs before acting?
One little note re China: US media likes to note the total number of Olympic medals won which puts the US in the lead. But if you weigh the medals as you ought (3 for a gold, 2 for a silver, and 1 for a bronze) China comes out way ahead due to its more plentiful gold medals. But you never hear that on the US media. Never.
China's performance was kind of weird statistically. If you look at the medal distribution for the other countries with a substantial (say more than 50) number of medals, the G-S-B distribution is pretty even. This makes some sense since there are an equal number of each kind of medal up for grabs. China, on the other hand, had more golds (51) than silver and bronze combined (49).
Why have certain people decided to exclude "water" from the geographies of China and the US to make China seem bigger?
I dont recall that little jerk Rogers using that qualifier.
Also, fresh water (which most of that "water" is) is a fairly valuable resource.
Face it, the US is bigger than China Jimmy Rogers was wrong.
Also, I could have won about 20 golds in Beijing and everyone knows it.
Well water has a value of course. So should we count water over the continental shelf too, and perhaps water in bathtubs in comparing China and the USA. And then there is bottled water. I suspect there is more of that in the US than in China. So clearly the US wins.
From google A professional investor talks about AIG
For the novice investor. This stock is a great stock to play for
swing trades because for one, it is primarily institutionally owned.
That means less volatile for a day trader. It also means that if you
follow the big money, you will win 90% of the time. We have just hit
bottom and the big money is buying back at this stock. It takes time
for an institution to purchase and sell large chunks and a firm
wouldn't buy 3M and 5M on consecutive days if they didn't strongly
believe in a swing up in the near future. As a smaller investor, we
can ride this wave with them and sell before they have the chance to
sell.
I'd rather be Brazil... Well brazil without all the Guns and knives. Lots of good land under that Damn rainforest. Water you got it. Rain check, oil check, gas check, sugah you bet
Nemo, actually, I kind of hate what I remember reading of him. I associate TANSTAAFL more with Milton Friedman. Then again, I kind of hate Milton Friedman, too. Just thought it was an appropriate name for an economics blog.
Large BMW's really haven't held their value well. I can get a 90's 7 or 8 Series in the teens. If you had said you own a Small Z8 I would be pretty jealous. You are much too sensitive...
I used to see Wamu brokered CDs on my brokers "Available CD Listing", but Wamu CDs have disappeared for the last 3 months. Wamu has been told no more CDs by the regulators IMO.
The Fed has blown their wad, and now watches helplessly. Even the Treasury does not have the borrowing power to save all the zombie financial institutions. They will have to decide which ones to let fail. What a disaster these idiots have allowed to happen on their watch. They will be infamous for hubris and poor judgement for millennium.
jim: "if you weigh the medals as you ought (3 for a gold, 2 for a silver, and 1 for a bronze) China comes out way ahead due to its more plentiful gold medals. But you never hear that on the US media. Never."
My god!! Jim Rogers is here!! So, Jim, China is substantially larger than the USA the same way that 223 is "way ahead" of 220? Because that's what the medal count works out to on your 3/2/1 G/S/B counting. For once, the US media doesn't make something out of nothing!! It's the 42d sign of the apocolypse!!
First!
Dear OTS -
I'm concerned too.
If $$$ blah, then
i don't see the problem...just buy sp500 futures
Isn't their ticker "Big Kahuna" or something?
p.s. Why is everybody so pessimistic lately? I am not implying the bottom is near; it's just too much negativity is unhealthy. We have survived previous recessions; we will overcome this one as well.
Also stating that the US by GDP/capita will be in the top 10 (or close) within the next 50 years sounds like sure bet.
S&P futures with the current market volatility?
-smockin out
The FHLB has advised us that it has changed its position regarding collateral held by affiliates, and that $736 million of pledged collateral from our affiliated REIT may not be fully eligible to support borrowings.
Looks like somebody got caught with a shady mark to model valuation.
BankUnited is a dyslexic name, so they deserve to have problems. It doesn't surprise me that their accounting is dyslexic, too.
Nother Cali what county are you in?
Dear BankUnited,
Is something wrong? You just haven't been yourself lately. This past year has been rough for everyone but you seem to taking it especially hard. Let me now if I can help.
Yours always, Sheila
"FDIC regulations limit the use of brokered deposits in certain situations"
I sure hope so...
This weekend I was wondering if the lack of bank failures so far might also have something to do with the complexity of the banking system.
The last time we had a major wave of failures, there was basically no internet, debit cards were less common, and in general it was a lot harder to move your money around quickly.
Combine that with an understaffed FDIC which has struggled to retain the old timers...if I were them I'd definitely want to start with a few smaller banks first.
This is another reason they'd want the Schumers of the world to keep quiet (not saying he should have, just another perspective).
Ten bucks says that this leads to a bank run on United... or at least that they claim it had something to do with their downfall..
.......
Combine that with an understaffed FDIC which has struggled to retain the old timers...
Banks are also reclassifying their loans like wells Fargo did and kicking the loss can down the road every quarter. Banks are waiting out the market like everyone else.
FDIC gonna be doing the Friday night blanket party for those folks, pronto.*
How soon can we push that IndyMac crap onto the skeleton team so we can take down the next big ones to go?
WAMU is also circling the drain.
That three and half buck chuck share price predicts less than three months.
That really is a whopper that will shake the markets.
Someday this war's gonna end...
*Nothing in this free blog post should be construed as implying that the fdic, ots, ncua, or any other government agency will manage to kill another zombie bank in any given timeframe, all speculation is simply the author's mad ravings, that have, in the past proven to be a bit like the ravings of Cassandra talking about the events of a certain greek unified war endeavor-glta!
forget bank united - yes a dyslexic name...
what is with LEH ? Is it toast ?
Thx
NS Capital Partners
Zombies!
Zombies everywhere!
Welcome to Racoon City!
In a prior thread, mailgilbs wrote:
It's not "catching a falling knife" when your investment horizon is 30 years and you're not trying day-trade during a bloodbath. I said I was young, not stupid.
mailgilbs | 08.24.08 - 5:36 pm | #
Mailgilbs,
I'm also new to this site, but I'm not new to investing. Your investment horizon is 30 years; that's only a few years longer than I've been trading. Oh, I had a career too, and a family and enough of the other little things in life that jump in and interrupt one's well thought out market positioning to make it interesting. As I read through the entire thread in which you made the above post, I could not help but ask myself what advice I might offer "off the cuff".
Here it is: the most sage investment advice I ever received: the Buddah Principle. Simply stated, that principle is that only you decide. As important as it is to understand the investment world, the rise and fall of the market, the business cycle, the sector cycle, bull and bear markets, and as important as it is to listen to others views of what is happening, it is more important that you understand who is making the investment decision. There is only one person who holds that power, and that is you.
In your 30 years, you will see as many market shifts and changes as I have. You will catch and miss just as many as I did. Through it all, you will hear many "informed" opinions. You will come to recognize that the vast majority of those seemingly smart folks were just flat wrong.... as it subsequently turned out. You will also find that a frustratingly large portion of the seemingly logical and {worse} trustworthy advice you receive will only have encouraged you to buy/sell for the sole purpose of enhancing the personal profit margin of the person who gave you the "hot tip" long after the opportunity for you to profit has gone. A few of those voices will educate you; but not very many. Through it all, there will only be one person who pushes that buy/sell button.
For what it is worth, my "investment advice" is to invest in yourself. Learn. Granted, it is most difficult to learn how the market works when all the market rules seem to be changing. The good news is that the market is always changing. However, it is particularly difficult now, because.... well take my word for it just this once..... this time there do seem to be big changes on the horizon. In the past 50 years, the major indexes have only dropped by 20% in any six month time frame a total of seven times. Take your age, add 50 and estimate the number of times you will see this kind of change again.
If you took the advice you've received thus far in this thread to heart, you would logically invest in mass produced gold sheathed bomb shelters - - opps, that's real estate, so you've probably heard the advice that you need to be careful there as well. I'm new enough here that I can still insult people with impunity. On the other hand, I've been around the market long enough to understand that 20% of the humans in this country have consistently owned 80% of the wealth of this country for a very very very long time; THAT percentage really doesn't change much. With all the drama we face, it's actually very unlikely, that percentage will change now. Possible, but very unlikely.
In the end, my friend, you would not even be concerned about these "big deal" investment outcomes if you were a member of the top 20%. So, let's be real; we both wish we didn't have to worry about the 15% of the wealth that 80% of us share, but we have no other choice.
Clearly, or at least, in my humble opinion, we are looking at a very significant change in the market. I'm a trend trader. In my language, we are looking at a possible top to the second counter trend rally of a new bear market. Garbeldegook, garbeldegook, garbeldegook. Nevertheless, I have found a way to work with the market that makes sense to me. I'm not here to sell it to you. Indeed, if I can, I will take a profit from any error you choose to make.
Here is my market advice. Trust yourself. Trust noone other than yourself. Never - ever blame anyone other than yourself if a trade goes against you. Know from the start that you will make mistakes. Make them !!! That is how you learn. If you learn from me, you will always assume your current market view is at least possibly mistaken, and you will set aside market available resources {cash} as a buffer against the very real possibility that you were right, but moved to fast - or, heaven forbid, that you were simply wrong. Either way, if the market moves against your best thinking, it's very nice to have a handy fall back position.
Put another way, as my version of the Buddah Principle would have said, " Listen. Listen to all of the advice. Listen to everyone. Look at the facts you understand and explore the possibilities sage advice suggests. However, if and when you choose to risk; understand the verb; never ever take that risk without understanding that it is YOU - it is YOUR MONEY - that you place at risk, and, if you're wrong, that YOUR MONEY that is gone. There is great wisdom in the notion that the first rule of making money in the market is DON'T LOOSE ANY.
So, let me bring it back home.... if I had 30 years left to make money in the market..... I'd ask myself, is this really Armageddon or are these guy's hyping something ? Were it me, I'd bet that the rich are not dumb, but wadda I know ?
New slogan for Wamu.
Cheaper than gas.
Re: efforts to seek to raise at least $400 million of capital and to submit an alternative capital plan
How does a crooked bank raise capital??
Re: well-placed sources within the bank, reported over the weekend that Fuld faces a planned coup that will force him out by year-end. The paper said operating chief Bart McDade, installed in June as Fuld sought to restore faith in the firm after a big second-quarter loss took Wall Street by surprise, has taken over many of Fulds responsibilities.
A slow motion plan to address a raging fire....???
planned coup"
By the same people that have a plan to save LEH... this goes from retarded to chaotic!
Weird market day. The only stocks that are really up are ones that have a very good chance of dropping to zero, or at least PK status.
And A VERY HAPPY BIRTHDAY TO FFDIC!
Oh Happy Day! I've been remembering that since last week, and spaced it out.
HBTY FFDIC!!!
One more little note: WAMU CD rates, online application:
8 mo 4.17% 4.25%
12 mo 4.89% 5.00%
13 mo 4.89% 5.00%
FFR cuts? What FFR cuts?
"Whether the CDS market is accurately assessing the creditworthiness of Lehman Brothers, trading on August 20th at 376 bps, double the level in early May, will be the next test of its worth."
They will be the next "BIG"/"Regional" bank to fail. They've gotten in way over their heads with the NeGAmOptARMs based upon all the depreciating Florida RE that its just a matter of time. The booking of deferred interest as present income has always been pure fiction, but now its a harsh reality that must now be dealt with via a Friday FDIC takeover. Look for it on a scale similar to IndyMac, and sooner rather than later.
old news
everyone in the banking industry knows these guys are toast.
move on...
OT:
JPMorgan Holds $1.2B Of Fannie Mae, Freddie Mac Preferred Stk
Last update: 8/25/2008 12:50:54 PM
DOW JONES NEWSWIRES
JPMorgan Chase & Co. (JPM) disclosed Monday in a regulatory filing that it held approximately $1.2 billion par value of Fannie Mae's (FNM) and Freddie Mac's (FRE) perpetual preferred stock.
JPMorgan estimates that such preferred stocks have declined in value by approximately an aggregate $600 million in the third quarter to date, based on current market values, according to the filing with the Securities and Exchange Commission.
Such securities are held in JPMorgan's investment portfolio and are marked to market through the company's earnings.
JPMorgan said the precise amount of losses that may be incurred on these securities for the third quarter is difficult to determine, given the significant volatility being experienced in the market values of these securities.
"Please oh please BB save my investment in the preferred shares......"
Said the current board member of the FRBNY, and current CEO of JPM.
"losses difficult to determine"
but the gains on any reduced liabilities are reported as profits...
Ciao
MS
to the above previous post:
They have not even taken a write-down on any of it:
"$1.2 billion par value of Fannie Mae's (FNM) and Freddie Mac's (FRE) perpetual preferred stock."
PAR VALUE......key phrase that.
Ciao
MS
FFDIC
Felicities upon the Anniversary of your Natal Inception.
Lehman is on the floor convulsing.
Fuld is a deer caught in the headlights.
Game over.
S&P goes on -29% tear 2nd Qtr year to year..Should be up in bizzaro world...
S&P 500 second-quarter earnings decline 29% from year ago - MarketWatch
Well, JPM may have lost $14/share on the FNM preferred, but they'll pocket the 52 cent dividend soon enough. Take that.
Then again, maybe that payout date won't come soon enough.
Nice yield of 26% or so on Wamu paper maturing in Jan of 2010.
"Underpants-Nomes Profit Theory" is being played out in the market:
Step 1: Get Underpants (Stock)
Step 2: Shrug/Question Mark
Step 3: Make Profit (Write Losses booked as Profit).
JPMorgan Holds $1.2B Of Fannie Mae, Freddie Mac Preferred Stk
Not anymore. /cluseau
Raising capital....>>>> Based on current market values, Mr. Gallagher sees AIG having to take a $6.5 billion write down, 1.5 times the amount he previously thought. That will decrease AIGs book value by a whopping 6 percent and could force it to raise capital to plug the hole in its balance sheet. Mr. Gallagher estimated that AIG will have to raise $7.5 billion in the second half of 2008.
Credit rating agencies are taking a hard look at AIG. Further deterioration in the companys earnings stream could cause the firm to be downgraded. The risks of a near term rating action have clearly risen, in our view, Mr. Gallagher wrote. In the event of a 1 notch ratings downgrade from both Moodys and S&P, AIG would be required to post up to $13.3 billion of additional collateral.
Raising that much money could be difficult in this credit environment.
AIG estimated a one-notch downgrade by both Standard & Poor's and Moody's, another credit rating agency, would require it to post up to $13.3 billion in additional collateral.
That could mean AIG would have to raise more capital on top of the $20 billion it recently raised. Credit Suisse's Gallagher expects the company to raise another $7.5 billion in equity capital this year.
lobal Investing Guru Jim Rogers on the Financial Crisis
The U.S. financial crisis has cut so deep - and the government has taken on so much debt in misguided attempts to bail out such companies as Fannie Mae and Freddie Mac - that even larger financial shocks are still to come, global investing guru Jim Rogers said in an exclusive interview with Money Morning.
Indeed, the U.S. financial debacle is now so ingrained - and a so-called "Super Crash" so likely - that most Americans alive today won't be around by the time the last of this credit-market mess is finally cleared away - if it ever is, said Rogers.
The end of this credit crisis "is a long way away," Rogers said. "In fact, it may not be in our lifetimes." During a 40-minute interview at a wealth-management conference in a West Coast Canadian city last month, Rogers also said that:
--U.S. Federal Reserve Chairman Ben S. Bernanke should "resign" for the bailout deals he's handed out as he's tried to battle this credit crisis.
--That the U.S. national debt - the roughly $5 trillion held by the public- essentially doubled in the course of a single weekend because of the Fed-led credit crisis bailout deals.
--That U.S. consumers and investors can expect much-higher interest rates - noting that if the Fed doesn't raise borrowing costs, market forces will make that happen.
--And that the average American has no idea just how bad this financial crisis is going to get.
"The next shock is going to be bigger and bigger, still," Rogers said. "The shocks keep getting bigger because we keep propping things up [and] bailing everyone out."
WTF! A WaMu banner add at the top of CR? Way too funny.
"They have not even taken a write-down on any of it:
"$1.2 billion par value of Fannie Mae's (FNM) and Freddie Mac's (FRE) perpetual preferred stock.""
That does not necessarily follow. They are stating the par value b/c the preferred dividends are based on the par value, not the market value. They may have written it down or not (not likely, yet, as they will prob. wait for quarter end).
Indeed, the U.S. financial debacle is now so ingrained - and a so-called "Super Crash" so likely - that most Americans alive today won't be around by the time the last of this credit-market mess is finally cleared away - if it ever is, said Rogers.
Thanks for the post but Damn! I wasn't going to bottom pick anyways but Damn!
Not in Jimmy Roger's lifetime, but hopefully in mine.
Someday this war's gonna end...
zaleriana -
Go look up the phrase "par value".
One can deduce that is my argument that you are simply re-stating.
Ciao
MS
"The next shock is going to be bigger and bigger, still," Rogers said. "The shocks keep getting bigger because we keep propping things up [and] bailing everyone out."
Selectively handing out money to the people and businesses who screw up the most has negative consequences?
This just sounds like nonsense conservative type thinking to me.
The OTS and FDIC hate brokered deposits because they are bullet proof.
I wondered where the mortgage guys went, brokering deposits and selling extended used car warranties.
Almost the same thing.
Why did I buy all that Fannie and Freddie preferred?!
I'm so smart! Just listen to the media! I may be the smartest man on earth!
No way that preferred isnt worth par. I'll call Paulson and Ben and tell them I'll fail if they dont guarantee it. They fell for my BS BS so this will be a walk in the park.
I am smart....
Such precise timing by the OTS and FHLB closing the barn door! Per chance is that horses I see galloping off in the distance?
"I wondered where the mortgage guys went, brokering deposits and selling extended used car warranties."
As stated earlier, Conjure Bag is available to solve these problems.
He asks only for a jet, a satellite phone, rusty pair of pliers, a few rolls of duct tape and a bulk pack of dental floss.
America will be restored to world-class competitor status in a matter of months.
He guarantees it, or your money back.
judging from some of the bolded text, those may be saddles or parachutes on their backs so it's kinda hard to tell (especially when you haven't a clue about how such things are usually worded!)
WTF! A WaMu banner add at the top of CR? Way too funny.
You do realize it is your moral duty to click on those? Because if anyone is going to benefit from the last WaMu pennies going out the door, it might as well be CR and Tanta.
I watch, and I listen..... but my read on the last hour or so of posts is that.... you are only fooling yourselves.... I wish you luck, but that is my read.
mp, they won't hire conjure.
Just as long as they don't ask me to show up for the first 100 days in DC.
My wife would be p.o.'ed at my absence.
Most of the 100 day guys ended up staying for years as the crisis just kept going and going.
This is getting uglier and uglier.
How come oil has stopped dropping back to $40 like Kudlow imagines poosible if we drill drill drill?
I am starting to drift into the really bad feelings about the fall camp. Even an election can't stop a lot of the damage from dropping out of wall street balance sheets.
Or should we just start calling them imbalance sheets? I just took a look at Corus's latest filing- fully half their deposit base could be called "brokered deposits" or equivalent. They even acknowledge they lost money on them, so essentially they are buying capital compliance with hot money.
This will not end well.
Someday this war's gonna end...
MS:
I need not look up the definition of par value; it's simple enough.
"We hold $x par value of preferred stock" does not mean that they hold that PS on books AT par value, currently. Maybe they do, maybe they don't, but it does not necessarily follow. If you find that one does, deductively, follow from the other, please explain it to simple, ol' me.
Grazie!
Cheaper than gas.
?Mason Suna
You are so lucky I had no coffee in my mug to spit out! Wamu is toast, but as you not the stock implies a 3 month life span.
Hey... All this BankUnited talk reminds me that we have a 'convenient' three day holiday approaching.
And for Wamu, its already been pointed out a convenient 4 day holiday approaches in November...
Got Popcorn?
Neil
"Not in Jimmy Roger's lifetime, but hopefully in mine."
In the other part of that interview, talking about future prospect for Chinese growth (and how he's still heavy in China), Jimmy Rogers said "America at that time ['96 Olympics] had 270 million people. Chinas got five times as many people, and its a much bigger country geographically."
When an 'expert' makes a fundamently incorrect statement like that (China is, at most, 2% larger than USA), I wonder what other faulty assumptions go into his analysis.
I kinda understand why the media likes him. He has this Russel crowe thing. However people are waking up to the fact that this guy's shit smells just like everyone else's. Hope you enjoyed your time in the sun Jamie.
Re "America will be restored to world-class competitor status in a matter of months."
I can do it in weeks, but I may need a blowtorch
China is smaller geographically than the US and much of their land is taken up by desert and uninhabitable mountain ranges and elevations.
I may not know much about preferred stock but I know geography...
I'm also a frickin' genius.
DaddieMac -
Its funny, because I took a dump the other day and I thought it stunk. But Dennis Neale, whose head happened to be up my ass, said there was no smell whatsoever.
Desperate people need to take desperate measures. As I measure things, the posts here are only growing more desperate - claims to wisdom and "inside calculated knowledge" ... I'm "so" not impressed. Fully 1/2 of the "oh so smart people now" will be broke in a couple of months. I've seen this movie before. Good luck.
ZERO!
"Desperate people need to take desperate measures. "
You mean like renditioning goat herders to Albania?
SHILL ALERT!!!!
Mark Zandi has just become the latest disgusting shill to call a bottom in housing sales on Bloomberg. He just lied his ass off, proving that his scumbag Moody's overlords have turned him into a lying shill.
His entire interview was filled with more lies than even an experienced liar like Dick Bove would normally try to pull off.
Zandi, you are the new low.
MS-
The prefs are marked to market according to your post:
"Such securities are held in JPMorgan's investment portfolio and are marked to market through the company's earnings."
Mr. JPM CEO:
List of countries and outlying territories by total area - Wikipedia, the free encyclopedia
Note the 3/4 for both the US and China. There seems to be some trouble determining the third and fourth largest countries. Unless you decree it.
No - - No - - I take it all back - keep up the who is up this second - who is down chatter - keep ignoring reality - it amuses me to watch you fall.
Yes, true. But more important is what S&P 500 earnings will do over the next 5-6 quarters, no? This is what forward P/E earnings are based on. And it's what all those statements about "the market being reasonably valued" are based on.
Here's what S&P thinks quarterly earnings will do YOY, based on their published bottom-up estimates:
Q3 08: +4.3%
Q4 08: +61.6%
Q1 09: +50.0%
Q2 09: +55.4%
Q3 09: +25.6%
Q4 09: +18.8%
From: standardandpoors.com
Indices, S&P 500 "Learn More", Operating Earnings & Estimatesby GICS Sector
In other words, bottom-up estimates are worth...shinola.
for all you pffft pump monkeys out there
Libor Signals Credit Seizing as Banks Balk at Lending (Update2)
(money quote 4 para down)
"The premium banks charge for lending short-term cash may approach the record levels set last year, based on trading in the forward markets, where financial instruments are sold for future delivery. Back then, concern about the health of the banking system led investors to shun all but the safest government debt, sparking the biggest end-of-year rally for Treasuries since 2000.
These problems going into year-end are likely to be worse this time round because of the amount banks have to refinance in December,'' Thomson said, citing a figure of $88 billion.The suspicion is that banks are still hiding losses. The banking system relies on trust and at the minute there quite simply isn't any."
Libor Signals Credit Seizing as Banks Balk at Lending (Update2) - Bloomberg.com
@ Sparks
We are all just sitting in a bar on the wharf waiting on the overhaul of the Love Boat.
Sparks, you keep trying to say goodbye but never close the door.
"Well, JPM may have lost $14/share on the FNM preferred"
How do you figure? JPM has 3.44B shares outstanding, so even if JPM bought it all at par (possible) and wrote it down to zero (possible soon), it's still only about $0.35/share.
$14/share would require a $48B+ investment--which is also possible, but not indicated by the 8-K. At least a couple of FNMA series of preferred are "no par", so the "$1.2B of par value" may be misleading, except that lying on an 8-K can lead to criminal sanctions and fudging that way is asking for a lawsuit.
I may not know much about preferred stock but I know geography...
I'm also a frickin' genius.
Yes so I've read loved the covers you did for all the magazines. China has a major problem. Trying to put 1 bill people to work while also trying to lead in technology ie automation. Good Luck with that
Sparks-
RE: Desperate people-I would look to homeowners who bought at peak, loved to heloc and purchased in sacramento valley, inland empire, los angeles, OC, san diego, East bay, reno/sparks, las vegas/henderson, phoenix metro, all of florida, atlanta, boise, tucson, denver and you might add other cities if you so wish...
My wisdom is shot but my common sense seems to serve me well and right now you seem to be preaching louder about something you feeling, not I or other posters..
cheers and good luck to ya in these desperate times..
Ross,
I became amused. I have no other excuse.
Zal-
It's their statement...not mine. I take that they, in fact, do hold it at par since how would that be any different than holding billions of dollars of crap at .90 when transactions have occurred at well below that value.
Read between the lines
Ciao
MS
Bankunited had a Texas ratio of over 50 at end of March. Probably much worse now. Curtains? I wouldn't wonder.
PPT should start ping ponging SP futures right about n.............
parks wrote:
"Desperate people need to take desperate measures. As I measure things, the posts here are only growing more desperate - claims to wisdom and "inside calculated knowledge" ... I'm "so" not impressed.
you hurt my feelings
but hey i'll let ya make it up to me
where's the smart money going, give us one prognosticatio
Everyone, please do not feed Sparks. Thank you.
Parks + Sparks above, sorry bad typing
ok
ill stop
"Such securities are held in JPMorgan's investment portfolio and are marked to market through the company's earnings."
And what is not said is that they are currently experiencing a complete and total lack of inputs in mark to market, so they say. Anyone that believes they are using real input on earnings releases, and more importantly these valuations, needs to have there head examined.
Why all the need for alphabet soup auctions if these things are truly marked to market and not fantasy??
Nice try though....
Ciao
MS
Uncle Ar -
Include Puerto Rico and the other US territories and you'll see that I am right without dispute (as per usual). Since most of China is simply made up of "territories" (some of which would prefer not to be - ie Tibet which aint exactly small) why not include US territories.
Dont mess with me. I'm smarter than every other bank CEO combined.
Also, Jim Rogers is wrong and a blowhard. I've never heard anyone kiss his ass like they kiss mine and he was a dumbass to claim that China is "much bigger geographically" than the US.
I rule and I'm never wrong.
These preferreds are money good too.
You'll see.
mock turtle,
my radar informs me you're a good guy. I'll let it rest there.
y, jim rogers is'nt even a billionaire...what a loser
MS:
Okay, get you now. Yes, saying basically the same thing--you in a bit more shorthand. Yes, they are intending to record a $600MM+/- loss on GSE pref in Q3-08; it has not yet been reflected.
I'm too lazy to figure out the following--was FNMA pref trading near par or at a premium in 04-06? If near par, then JPM bought after it began to slide in price, as it's down about 75%, rather than ~50%. This seems likely, as that explains using par rather than investment amount--$600mm loss on $900mm invested is a lot uglier.
The entire 8-K sez:
"JPMorgan Chase & Co. disclosed today that it held approximately $1.2 billion par value of Fannie Mae and Freddie Mac perpetual preferred stock. Such securities are held in the Firm's investment portfolio and are marked to market through the Firm's earnings. The Firm estimates that such preferred stocks have declined in value by approximately an aggregate $600 million in the third quarter to date, based on current market values. The precise amount of losses that may be incurred on these securities for the third quarter is difficult to determine, given the significant volatility being experienced in the market values of these securities."
One must have a wickedly wry sense of humour to enjoy this site. Or a wickedly large bottle of rye.
Your choice
Roubini says:
So every G7 economy is now headed toward recession. Other smaller economies (mostly the new members of the EU, which all have large current-account deficits) risk a sudden reversal of capital inflows; this may already be occurring in Latvia and Estonia, as well as in Iceland and New Zealand.
This G7 recession will lead to a sharp growth slowdown in emerging markets and likely tip the overall global economy into a recession. Those economies that are dependent on exports to the US and Europe and that have large current-account surpluses (China, most of Asia, and most other emerging markets) will suffer from the G7 recession. Those with large current-account deficits (India, South Africa, and more than 20 economies in East Europe from the Baltics to Turkey) may suffer from the global credit crunch. Commodity exporters (Russia, Brazil, and others in the Middle East, Asia, Africa, and Latin America) will suffer as the G7 recession and global slowdown drive down energy and other commodity prices by as much as 30%. Countries that allowed their currencies to appreciate relative to the dollar will experience a sharp slowdown in export growth. Those experiencing rising and now double-digit inflation will have to raise interest rates, while other high-inflation countries will lose export competitiveness.
Global recession in the works, no refuge anywhere.
Ross,
Rye
Hey Dimon,
You're a punk. I may be a little shit but I could kick your sorry ass. Just name the time and the place and remember to bring your $80 trillion derivatives portfolio with you. That's assuming you can find it underneath all that Fannie and Freddie preferred and the crap that Jimmy Lee talked you into putting on your balance sheet.
Dr Doom knows that China ain't significantly larger "geographically" than the USA. Rogers is pumping his book to the xenophobic rubes.
Mr. JPM CEO:
So Puerto Rico and others get representation in Congress (Non-voting doesn't count)? Just asking.
I guess if we included the 'disputed' area of Iraq the U.S. would certainly be larger.
Tanya Stafel --
A Heinlein fan, I presume?
This is confusing. If we are to raise capital while yields are falling and thus increasing our cost to borrow, will we have to borrow more money?
How does this impact retained earnings and dividends, and then, treasury stock is valued at its repurchase price and not its issue price, thus, its value must be apportioned over stock and retained earnings and then these matters of accumulated losses or gains that are listed below the balance sheet that have not yet been reconciled through the income statement. Then we have Level 3 shit, which for all accounts is some kind of spiritual entity that morphs around like cloud formations -- so you have to factor that cloud into future value and shit, who cares?
I think when Jimmy R. talks about the size of China, he is including all of S. East asia.
They got Nukes too.
Rogers -
I have chunks in my stool bigger than you.
How's all that gold treating you the past month?
Investment Biker? More like investment loser.
Marry someone old enough to be your daughter next time. Also, a trophy wife is suppose to be goodlooking you Smurf.
Da Spooks agree with Jamie on who's bigger: US the winner by a nose (230K Km2)
Fuzzy Guru:
Say that again - just to convince me that you are posing an honest question - this site has a devastatingly nasty level of sarcasm - but I'm new here and capable of honest discussion.
Uncle Ar -
Yeah right.
And all of China has a voice in their government.... If thats the standard then China is about the size of Staten Island.
What voice does Tibet have in the PRC?
Again, I'm Jamie Dimon.
I'm awesome.
They have contradicted their own statement...
"losses that may be incurred on these securities for the third quarter is difficult to determine, given the significant volatility being experienced in the market values of these securities."
There is nothing "difficult to determine" since the share price today is severely lower than when these securities were purchased. Yes I am making an assumption however they are making the same assumption about input pricing on current valuations simply because that's how the game is played.
Cloaking it in regulatory BS is all I see going on here.
End of story.
Ciao
MS
who called the pump ! what a call!!!
To Mark S., it is not a weird market if you are short financial and long commodities. If your longs are doing poorly, you dump your longs and buy your shorts to meet a margin call. Either way, it looks like I made the right call to dump everything except my defense stock last week. I got greedy and lost my 6% gain for the year. I expect to finish with a 3% gain but at least I will not lose money.
termination of the option ARM loan program;....termination of reduced and no documentation loan programs; reduction of the portfolio of negative amortization loans;
Why are any of these still being done by anybody - especially anybody who is under Federal regulation? Hasn't anybody learned anything yet?
Jamie Dimon writes:
Uncle Ar -
Yeah right.
And all of China has a voice in their government.... If thats the standard then China is about the size of Staten Island.
What voice does Tibet have in the PRC?
That must make the US the size of ExxonMobil.
"Why are any of these still being done by anybody"
Option ARMs are returning whence they came--as a wealth management offering for HNW individuals with lumpy income. And, as before, the banks will accept pledges of financial assets in lieu of down payment requirements. They're useful in their place--that place being the genuinely wealthy, not the house flipper.
Dr Doom knows that China ain't significantly larger "geographically" than the USA.
CIA fact book
China land area 9,326 million sq km
USA ditto 9, 161 million sq km
Depends upon what you mean by "significantly".
I'll give you a banana once the pump amounts to something more than what currently looks an awful lot like noise.
I was expecting something a bit more impressive after the wild sell-side RSI plunge the SP500 took as lunch hour was starting. Still an hour to go. Rally into the close...? I dunno. Coin flip at this point methinks.
China land area 9,326 million sq km
Does that include the island of Formosa?... yet?
Given all the problems with Option ARMs and stated income (liar loans) that first appeared around March of 2007, why hasn't the OTS and FHLB simply banned these types of loans at regulated institutions? Why wait until an institution is on its last legs before acting?
One little note re China: US media likes to note the total number of Olympic medals won which puts the US in the lead. But if you weigh the medals as you ought (3 for a gold, 2 for a silver, and 1 for a bronze) China comes out way ahead due to its more plentiful gold medals. But you never hear that on the US media. Never.
OT. What time zone does Halo Scan display?
China's performance was kind of weird statistically. If you look at the medal distribution for the other countries with a substantial (say more than 50) number of medals, the G-S-B distribution is pretty even. This makes some sense since there are an equal number of each kind of medal up for grabs. China, on the other hand, had more golds (51) than silver and bronze combined (49).
"OT. What time zone does Halo Scan display?"
It's shortly after noon here on the left coast and times are shortly after 3 PM. Looks like eastern daylight time to me.
Why have certain people decided to exclude "water" from the geographies of China and the US to make China seem bigger?
I dont recall that little jerk Rogers using that qualifier.
Also, fresh water (which most of that "water" is) is a fairly valuable resource.
Face it, the US is bigger than China Jimmy Rogers was wrong.
Also, I could have won about 20 golds in Beijing and everyone knows it.
Wow, AIG a teenager. Love watching financials going through reverse puberty.
Looks like a few more are going to be stuffed back in the womb.
New meaning to the term 'I wish you were never born'.
"Looks like a few more are going to be stuffed back in the womb."
Or perhaps a short distance aft of there...
Well water has a value of course. So should we count water over the continental shelf too, and perhaps water in bathtubs in comparing China and the USA. And then there is bottled water. I suspect there is more of that in the US than in China. So clearly the US wins.
Manulife surpasses AIG...Manulife? How about Manulike. Damn Im funny
You must be "jim" Rogers.
I suppose that 1.3mm km of Gobi desert in the PRC is of more value than the Great Lakes and all of the reservoirs in the US.
From google A professional investor talks about AIG
For the novice investor. This stock is a great stock to play for
swing trades because for one, it is primarily institutionally owned.
That means less volatile for a day trader. It also means that if you
follow the big money, you will win 90% of the time. We have just hit
bottom and the big money is buying back at this stock. It takes time
for an institution to purchase and sell large chunks and a firm
wouldn't buy 3M and 5M on consecutive days if they didn't strongly
believe in a swing up in the near future. As a smaller investor, we
can ride this wave with them and sell before they have the chance to
sell.
Poor schmuck probably got in at 40...
Let Wici decide.
List of countries and outlying territories by total area - Wikipedia, the free encyclopedia
Don't knock deserts. I'd rather own some choice desert and mineral rights thereto in Arabia than any ten square miles of Iowa.
CSc is that you.
I'd rather be Brazil... Well brazil without all the Guns and knives. Lots of good land under that Damn rainforest. Water you got it. Rain check, oil check, gas check, sugah you bet
Nemo, actually, I kind of hate what I remember reading of him. I associate TANSTAAFL more with Milton Friedman. Then again, I kind of hate Milton Friedman, too. Just thought it was an appropriate name for an economics blog.
From now on, I will make it a point to remember how sick you folks are. Sad as it is.
I wonder if anyone has done the analysis to determine if AIG has any "net worth" left.
From now on, I will make it a point to remember how sick you folks are. Sad as it is.
tattoo it like on Momento...
What was the topic of this thread???
I wonder if anyone has done the analysis to determine if AIG has any "net worth" left.
I read in bloomberg that 1/3 of their net worth was tied directly to Mortgage backed securities.
daddy mac I'm disapointed!!!
RE: Brazil-how could you forget the women..
outnumber men 8-1 or something like that...
DaddieMac writes:
From now on, I will make it a point to remember how sick you folks are. Sad as it is.
tattoo it like on Momento...
What was the topic of this thread???
Post this under my BMW is bigger than yours; I don't give a crap what you think.
Post this under my BMW is bigger than yours
Large BMW's really haven't held their value well. I can get a 90's 7 or 8 Series in the teens. If you had said you own a Small Z8 I would be pretty jealous. You are much too sensitive...
All I can say is, I hope the jerks who seem to think they have the market figured out ... get burned. That is not my market sense, it's personal.
You show them Sparks...=)
Daddie,
they moved on to the next link before reading what I said... refresh
I used to see Wamu brokered CDs on my brokers "Available CD Listing", but Wamu CDs have disappeared for the last 3 months. Wamu has been told no more CDs by the regulators IMO.
The Fed has blown their wad, and now watches helplessly. Even the Treasury does not have the borrowing power to save all the zombie financial institutions. They will have to decide which ones to let fail. What a disaster these idiots have allowed to happen on their watch. They will be infamous for hubris and poor judgement for millennium.
BankUnited Financial Corporation = BKUNA. Well duh, it has BK right in the ticker. How much easier can it get?
"Also stating that the US by GDP/capita will be in the top 10 (or close) within the next 50 years sounds like sure bet."
Many people know what will happen in fifty years, but unfortunately not all of them agree with one another.
In fifty years I will be 119 years old - if I live that long.
Wow, this Sparks troll sure has her panties in a bunch.
BKUNA is home to a honcho that I worked for before, in the early 80s, who couldn't bank his way out of a paper bag.
jim: "if you weigh the medals as you ought (3 for a gold, 2 for a silver, and 1 for a bronze) China comes out way ahead due to its more plentiful gold medals. But you never hear that on the US media. Never."
My god!! Jim Rogers is here!! So, Jim, China is substantially larger than the USA the same way that 223 is "way ahead" of 220? Because that's what the medal count works out to on your 3/2/1 G/S/B counting. For once, the US media doesn't make something out of nothing!! It's the 42d sign of the apocolypse!!