Alright already, we get it. Lot's of "great" news after the close today, expect a huge rally tomorrow. We get it, thanks. No mas (I live in California, practicing my spanish just in case we have to sell it back).
More than 45 major U.S. companies, including big banks, are being offered settlements to get rid of abusive tax shelters, the Internal Revenue Service said on Wednesday.
"Promoters and participants in aggressive tax shelters should know that the IRS will remain vigilant," IRS commissioner Doug Shulman told reporters on a conference call.
The IRS will offer companies a settlement for "lease-in lease-out" (LILO) and "sale-in lease-out" (SILO) transactions, which have allowed companies to beef up their balance sheets by gaining billions of dollars in tax deferrals.
We were asleep but now that we have awoke form our stupor the IRS will remain vigilant. They need to drag all these bastards out in the street and chop their heads off.
Losses aren't losses, they are "impaired gains". Rally on, Garth. Short sellers are fools. There is nothing but gains even if they are temporarily negative. Is 25 years temporary?
IRS working on new technologies. Anti-"tar 'n' feather, pitchfork, rail" tactics. They assess from afar, never make physical contact, and use aegis systems or predator delivered weapons against holdouts. Freedom fries, anyone?
This is a good quarter for AIG by all standard metrics. Lots of losses in lots of different places with lots of talk and no real direction forward. It must be a buy.
Wachovia Corp. stopped accepting applications for private, undergraduate student loans at the close of business Wednesday.
The Charlotte-based bank (NYSE:WB) will continue to offer student loans for both graduate and professional education as well as student loans backed by the federal government.
We are constantly evaluating our organization in the current environment, to ensure that were doing whats best for our customers, our shareholders and our company, and at this time we thought it was prudent to stop accepting private undergraduate student loans, Wachovia spokeswoman Ferris Morrison says.
Wachovia has about $9.9 billion in student loans on its books, Morrison confirms.
In April, crosstown rival Bank of America Corp. (NYSE:BAC) said it would discontinue selling private student loans. At the time, a BofA spokesperson said the bank wanted to focus on government-backed loans to provide a more consistent experience for custome
In the good news camp, analysts at UBS upgraded AIG this morning. The stock promptly rallied in response to the upgrade, which I find amusing. AIG reports earnings tomorrow. Why on earth would an investor buy a stock the day before the earnings report just because some analyst at UBS, of all places, decided on a whim that this stock is a buy? Is that because UBS knows subprime better than anyone? UBS has certainly lost enough money in the past year because of its subprime exposure, so I suppose that could be the reason. In any event, once again, without irony, this is reported in the financial press as if it were significant news. Bloomberg even has the misleading headline "AIG Rises as UBS Upgrades to Buy on Narrower Losses" implying that the company has already reported narrower losses, which is certainly not the case. Personally, I'm going to wait to hear the actual earnings report from the company itself. Call me crazy but I don't have an particularly itchy trigger finger.
Finally, ubiquitous of education subsidies that were defaulted on just so the plebes could get a "leg-up" was sickening. Back to real elitism, where things have to be paid with cash on the barrel, save against hardship stuff. All these eggheads now from the lower ranks are defiling the souffle.
"House Financial Services Committee chairman Barney Frank (D-MA), along with other committee members, sent a letter on Tuesday afternoon to senior servicing executives looking to persuade them to engage in forbearances with troubled borrowers, until the so-called Hope for Homeowners program tied to a recently passed housing bill takes effect on October."
LAS CRUCES, N.M. Pink morning light climbs over the jagged Organ Mountains, casting a glow on the Rio Grande, the lifeblood of this otherwise unforgiving desert.
Outside the door is the historic Mesilla plaza, the best preserved Mexican-style village in southern New Mexico. The bells of San Albino church ring each morning and evening, a fitting reminder that San Albino was the patron saint of the "little people," the sick, the indigent, widows and orphans.
Translation: college is no longer a profitable investment for the masses, and we can't afford to back any more losers. If the gub-mnt is backing the loans we're right there, but most of these liberal-arts basketweaving types will be lucky to work the factory floor, if not serve fries.
Shutting down student loans will shut down schools, tightening commercial construction lending should stop construction, cutting off car loans will shut down dealers and manufacturers, closing off mortgages will shut down realtors and homebuilders, lower tax collections should shut down state and local governments and tightening credit cards and ending HELOCs should take care of anything else that might have slipped through the cracks.
I have a favorite deli and there are often lineups to buy stuff. They have a little thingy whereby you can take a number and be served in sequence. Is there such a thingy for the confessional?
and:
" Hmm.. shorting is illegal. Who will stop the fall ????
leftback"
Is naked buying legal? Why cant I get purchased shares delivered to me so that I can have them in my possession and can not sell them until they are in my hot little hands.
Many of the worlds biggest banks are proposing reforms that would limit the size and scope of their businesses in one of the most dramatic responses to the credit crisis.
The proposals would hold down the number of investors who can buy complex financial products, bring large swathes of the derivatives markets into regulators sights and call on banks to spend more on technology and risk management.
The consequence would be that many of the securitisation businesses that helped fuel the boom on Wall Street and the City of London in the middle years of this decade could face tougher oversight and find far fewer opportunities for growth.
Perhaps the most unexpected proposals involve new criteria for the sophisticated investors allowed to buy complex financial products. Under the plans, even pension funds and other institutional investors would no longer be automatically allowed to buy bonds backed by assets such as subprime mortgages. All but the wealthiest retail investors would be barred from buying structured products, such as auction rate securities, a $330bn market used by municipalities and student loan providers to raise funds.
Isn't AIG one of those "sophisticated investors"? Didn't they just get whacked along with every other "sophisticated investor"?
Curious. These securities are toxic to the entire financial system. No one is smart enough to understand them.
Regency Laguna Niguel is showing "Forbidden Planet" at 7:30 on Thursday night. Thought you might want to roll one up and grab an actual bag of popcorn.
That, or go watch Pineapple Express.
Might be cool to remember what our forebears considered scary in 1956.
It's called Jimmy Christ Superstar and no, that's not me. Although this dude looks stoned, I have confirmed that he does not smoke. He does, however, support legalization.
I'm going to look at Pineapple Express. What a rad movie name.
My prediction - a massive increase in Pell Grants and low interest (maybe even 0%) student loans (government backed) in the near future - college and graduate school affordable to all! Benefits - 1) $$ into the hands of impoverished middle and working class, 2) some improvement in employability with additional education (though this is vastly overstated by politicos), 3) spreads $$ into lots of towns/cities across the country that have colleges/ community colleges/universities. Essentially, a great "liquidity bus" to channel $$ into the economy.
Downside - another body blow to bucky ($$). Still, a better use of tax dollars (we don't really have) than bombing middle east infrastructure...
I'm going to look at Pineapple Express. What a rad movie name.
One of the dudes who wrote it was on Jon Stewart (the only serious newsman left) last night. Not your best role model, but made me LMFAO.
I miss my 20s, they were fun.
My trading account is absolutely LOADED FOR BEAR. To the brim. There is no way in hell we escape this summer without a meltdown. There will be a rush for the exits. Who wants to be holding this bag?
Sorry if this is OT. I've been playing penny stocks small-time for 2 years (NFL offseason, need my fix). Everyone knows these are full of scams, but I swear the past two months have opened the fraud floodgates. And it's not even disguised or intelligent scams any more. Pure shameless pump and dump, total disregard for any SEC regs. The FFGO scam going on right now will probably go down as the biggest penny scam in history. Desperate people preying on those even more desperate.
I really should have anticipated this once the gov't made it obvious there were no consequences for the big boys.
Sorry if this is OT. I've been playing penny stocks small-time for 2 years (NFL offseason, need my fix). Everyone knows these are full of scams, but I swear the past two months have opened the fraud floodgates. And it's not even disguised or intelligent scams any more. Pure shameless pump and dump, total disregard for any SEC regs. The FFGO scam going on right now will probably go down as the biggest penny scam in history. Desperate people preying on those even more desperate.
I really should have anticipated this once the gov't made it obvious there were no consequences for the big boys.
Closest to it I can think of is St. Francis of Assisi, who must be the patron saint of poverty. But it was something he welcomed, so perhaps not what you were thinking of.
I have herd it said, that if you bury your AIG stock certificates in a plastic bag and place them underground for 2 years, you will make enough back at that point, to pay for the plastic bags. I am not a broker or saint.
Foreign Life Insurance & Retirement Services operating income reflects strong results in all product lines and growth in annuity assets undermanagement. Life insurance premium growth was driven by increased demand for investment-linked products throughout Southeast Asia and single premium life products through the Japan bank distribution channel. Performance in Taiwan improved due to sales of investment-linked products and improved net investment income, principally from higher seasonal dividend income of $35 million. Results in Japan continue to be affected by increased competition, especially in the personal accident & health market, and the runoff of the higher margin acquired inforce business at AIG Star Life and AIG Edison Life. Operating income for the quarter also increased by $42 million as a result of out of periodadjustments for reinsurance and net investment income.An unfavorable foreign exchange environment continued to affect individual fixed annuity deposit growth in Japan when compared to the third quarter of 2005. However, the launch of an automatic withdrawal rider for fixed annuities helped deposits increase compared to the secondquarter of 2006. This feature has also been successfully introduced in the Korean market. Sales of individual variable annuities increased in thethird quarter of 2006 compared to the third quarter of 2005
I heard that Clorox is raising prices on its Glad bags by 10% in September. If you want your AIG certificates to pay for those bags you better act swiftly.
Your very nice to be helpful in sharing that bonus info, I appreciate it so much!
I'm currently looking at the possibility that these AIG sinners will have the same results occur unto them, which occurred unto SCOTTISH RE GROUP LIMITED, but The Devils in the details, don't yah know:
I'm chasing after Satan and the crossed up matters of coinsurance, reinsurance and all the distortion that goes into this sinful fraud:
For agreements written on a modified coinsurance basis and certain agreements written on a coinsurance funds withheld basis, asset values recorded in the balance sheet are equal to the net statutory reserve fund balances with the assets backing the reserves retained by the ceding company and managed for our account including the reporting of amortized costs and fair value on the portfolio. The amounts in the funding accounts are adjusted quarterly to equal the net statutory reserve balances.
Why is no one one talking about the revenue?? These guys reported 19.5 billion in revenue compared to 31.5 last year and consensus estimate of 31.5 this year. Did the company not open up their doors for a month??? Or, this is really scary, has the market decided AIG is not fit as an insurer? I mean losses are losses and this could be a kitchen sink quarter for the new CEO but a 33% drop in revenue seems on the scale of catacylsmic. If the market gives up on AIG (no one will write business with them), it will make Bear Stearns look like a picnic with Goldilocks.
It seems to me that these ceding companies frontrun accounting fraud and act as a conduit, but it is something that is difficult to ascertain:
For example: The Company reinsures portions of its life and accident and health insurance risks with unaffiliated companies. Life insurance risks are reinsured primarily under coinsurance and yearly renewable term treaties.
I mean really, what does that mean to a poor little shareholder looking for a simple dividend, i.e, are these people selling dope or guns or what?
The losses are a little higher than we would have hoped for, Bill Fitzpatrick, an equity research analyst with Optique Capital in Milwaukee, said of the credit swap losses.
But he still expects the insurer to eventually see some of the unrealized losses reverse as market conditions improve.
The thesis remain the same that these portfolios will ultimately be marked up, Mr. Fitzpatrick added.
Oh, I think my Hail Mary Pass on the web just went through, what a wonder!
Here try this: Evaluating Embedded Derivatives under DIG B36 Eric SchueringSOA Spring Meeting May 25, 2006
Scope of DIG B36
FAS 133 provides additional guidance on applying not-clearly-and-closely related criteria (paragraph 13)
Careful consideration should be given to the interplay of variousguarantees Model mortality and associated GMDB in valuation of GMWB, and vice-versa.
With all this bullshit with Level 3 and mak-to-market, who can say what Satan is doing with AIG? Oh my, if I only knew!
A federal judge on Wednesday handed down the first sentences to defendants convicted in a $1.9 billion corporate fraud case that federal prosecutors compared to the Enron or WorldCom scandals.
U.S. District Judge Algenon Marbley sentenced Donald Ayers, a former chief operating officer with National Century Financial Enterprises, to 15 years in prison for his role in the fraud. Randolph Speer, the company's former chief financial officer, received a 12-year sentence.
The sentences were long enough to punish the men, to deter others from committing similar crimes in the future and to respect the law, Marbley said.
Marbley also ordered the men to repay billions of dollars to investors, along with three other co-defendants yet to be sentenced.
The biggest insurers in the U.S. and Bermuda posted more than $77 billion in writedowns linked to the collapse of the mortgage market from the start of 2007 through the first quarter, with AIG representing about half that total.
This is a bogus number, way too low.
Here's some reasons:
Many insurance companies have direct (not mortgage passthrough) exposure to residential and commercial real estate, equity and debt.
Mutual life insurance companies (like Northwestern) don't report their earnings like public companies. They aren't subject to the same accounting standards.
There's a lot of bad and sinking corporate debt on life insurance company books. Borderline investment-grade and below.
Insurance companies have huge, unhedged exposure to equity markets based on guaranteed returns, like in variable annuity death benefits.
Before this is over, you'll see at least 50 insurance company failures, mostly small hole-in-the-wall companies but very painful for their policyholders (no FDIC). Maybe 1-2 pretty good size failures.
Insurance companies are still in hiding and denial.
TO THE POSTER WHO SUGGESTED I LOOK AT DRY FLY LIQUOR FOR LUCKYS.
I did contact their reprersentative but we cannot use their product. We sell a lot of pints and airline minis in plactic bottles, because our customers fall over a lot.
We didn't have a good fit but thank you for your marketing ideas.
The Company issues certain variable annuity products that offer optional
guaranteed minimum account value ("GMAV") and guaranteed minimum withdrawal
benefit ("GMWB") living benefits. Under Financial Accounting Standards
Board ("FASB") Statement of Financial Accounting Standards ("FAS") No. 133,
"Accounting for Derivative Instruments and Hedging Activities", the GMAV
and GMWB are considered embedded derivatives that are required to be
bifurcated from the host contract and carried at fair value. The fair value
of the GMAV and GMWB requires significant management estimates and is based
on the present value of expected benefits to be paid less the present value
of fee income associated with the guarantees. The fair value estimate of
the GMAV and GMWB guarantees include unobservable inputs such as
management's estimate of contract holder behavior as well as such
observable inputs as swap curves and market calibrated implied volatility.
The Company also economically hedges these guarantees by utilizing both
exchange traded and over-the-counter index options and exchange traded
futures. Exchange traded index options and futures are marked to market
using observable mid-market quotes while over-the-counter index options are
marked to market through matrix pricing that utilizes observable market
inputs. The GMAV, GMWB and index options are reported in derivative assets
or derivative liabilities in the consolidated balance sheet. The changes in
fair value of the Company's derivative instruments are reported in net
realized investment gain (loss) in the accompanying consolidated statement
of income and comprehensive income.
Calculated Risk: it's like waiting for the rapture.
I happened to buy life insurance this past year. AIG had the lowest rates, but I specifically did not go with them since a lot of the cracks were starting to show.
There are state guaranty funds to protect policyholders. Might take awhile to get your money, but I think most are made whole. They are funded by assessments on insurers operating in each state. I think the system has worked pretty well since inception because you haven't had systemic collapse (a la Great Depression) in insurance, since perhaps the 1906 SF earthquake (if even then).
BTW, I was addressing your "very painful for the policyholders (no FDIC)" comment and not your overall point about risks facing insurance company balance sheets.
(Be aware that P&C carriers have experienced the last couple years underwriting profits not seen in over a generation, though I think that is starting to erode. Life insurers, which are more of an investment play anyway, I believe operate on much thinner margins.)
All these corporations knew FASB Level 3 accounting was going to be an issue and things like FIN 46, so what happened, they ignored restructuring and adjusting entities in anticipation of this free-fall event? I wonder if these people are not all betting on the downside and pushing stocks as low as they can, while "they" short their own shares. Get real, why would they know in advance that they were going to be burned alive and sit there without a strategy? Huh, huh punk?
I swear to god that the XLF will rally on this. This seems to be the MO these days. Bad news is good news and good news is great news. It's a sign the bottom is in will be the spin. Wait for it.
The reason many past crashes happened in October was that it was just after harvest time. Banks would lend to farmers for seed, equipment etc., in the spring and then demand repayment when the crops came in. The agricultural component of the economy has obviously shrunk over time, so this cycle has become less pronounced. Perhaps the ethanol boom will reinstall it- not sure when corn is harvested - Dryfly?
Get real, why would they know in advance that they were going to be burned alive and sit there without a strategy? Huh, huh punk?
Because everyone knew the regulators could be taken hostage with suicide strategies.
The agricultural component of the economy has obviously shrunk over time, so this cycle has become less pronounced.
Heating + fuel costs and their inverse relationship with Christmas consumer spend will replace that nicely. I think November is when it will get really grotesque.
Because everyone knew the regulators could be taken hostage with suicide strategies.
Precisely so...all the more reason for stronger regulation from the get-go - don't give the bastards enough rope to hang themselves, or they will. What is it with the GOP and drunks? Permanent enablers. Dumbya does speak truth - pretty clearly - you just have to do a little careful deconstruction to pick out the bits.
First.
But all it means is I have nothing better to do than hang around on line waiting for Tanta or CR to post something.
Dang!! When is AIG going to stop the bleeding? Was Hank Greenberg part of these bad bets?
Alright already, we get it. Lot's of "great" news after the close today, expect a huge rally tomorrow. We get it, thanks. No mas (I live in California, practicing my spanish just in case we have to sell it back).
It is all about shuffling the loses around now and waiting it out.
More than 45 major U.S. companies, including big banks, are being offered settlements to get rid of abusive tax shelters, the Internal Revenue Service said on Wednesday.
"Promoters and participants in aggressive tax shelters should know that the IRS will remain vigilant," IRS commissioner Doug Shulman told reporters on a conference call.
The IRS will offer companies a settlement for "lease-in lease-out" (LILO) and "sale-in lease-out" (SILO) transactions, which have allowed companies to beef up their balance sheets by gaining billions of dollars in tax deferrals.
IRS offers banks and others tax shelter settlement
| Reuters
We were asleep but now that we have awoke form our stupor the IRS will remain vigilant. They need to drag all these bastards out in the street and chop their heads off.
Losses aren't losses, they are "impaired gains". Rally on, Garth. Short sellers are fools. There is nothing but gains even if they are temporarily negative. Is 25 years temporary?
I don't think AIG has marked down as far as Merrill Lynch. Much more to come.
IRS working on new technologies. Anti-"tar 'n' feather, pitchfork, rail" tactics. They assess from afar, never make physical contact, and use aegis systems or predator delivered weapons against holdouts. Freedom fries, anyone?
This thing almost begs the question, 'how many shoes can there be'?
Only Imelda Marcos knows...
This is a good quarter for AIG by all standard metrics. Lots of losses in lots of different places with lots of talk and no real direction forward. It must be a buy.
... and Bermuda
AIG is the biggest offshore tax evasion unit in the world and Warren is running scared as hell, count on it!
AIG, thats for Ain't It Grand?
Beatty or Buffett? Beatty's always been a sissy boy.
OT: Wachovia exits private student-loan business
Wachovia exits private student-loan business - Charlotte Business Journal:
Wachovia Corp. stopped accepting applications for private, undergraduate student loans at the close of business Wednesday.
The Charlotte-based bank (NYSE:WB) will continue to offer student loans for both graduate and professional education as well as student loans backed by the federal government.
We are constantly evaluating our organization in the current environment, to ensure that were doing whats best for our customers, our shareholders and our company, and at this time we thought it was prudent to stop accepting private undergraduate student loans, Wachovia spokeswoman Ferris Morrison says.
Wachovia has about $9.9 billion in student loans on its books, Morrison confirms.
In April, crosstown rival Bank of America Corp. (NYSE:BAC) said it would discontinue selling private student loans. At the time, a BofA spokesperson said the bank wanted to focus on government-backed loans to provide a more consistent experience for custome
In the good news camp, analysts at UBS upgraded AIG this morning. The stock promptly rallied in response to the upgrade, which I find amusing. AIG reports earnings tomorrow. Why on earth would an investor buy a stock the day before the earnings report just because some analyst at UBS, of all places, decided on a whim that this stock is a buy? Is that because UBS knows subprime better than anyone? UBS has certainly lost enough money in the past year because of its subprime exposure, so I suppose that could be the reason. In any event, once again, without irony, this is reported in the financial press as if it were significant news. Bloomberg even has the misleading headline "AIG Rises as UBS Upgrades to Buy on Narrower Losses" implying that the company has already reported narrower losses, which is certainly not the case. Personally, I'm going to wait to hear the actual earnings report from the company itself. Call me crazy but I don't have an particularly itchy trigger finger.
Mock The Market: Market Higher on Continued Declines in Commodities Prices
Finally, ubiquitous of education subsidies that were defaulted on just so the plebes could get a "leg-up" was sickening. Back to real elitism, where things have to be paid with cash on the barrel, save against hardship stuff. All these eggheads now from the lower ranks are defiling the souffle.
They just bought my car insurer, 21st Century. They're charging 50% more than the competition for like coverage.
Of course, I didn't even get the loans.
"Was Hank Greenberg part of these bad bets?" Hang on a sec, leave the original Hammerin Hank out of this
If anyone loves derivatives and synthetic off balance sheet hocus pocus, it's AIG, but where is Spitzer?
Fewer foreclosures coming to a neighborhood near you...
OT:
House Committee to Servicers: Forbear
House Committee to Servicers: Forbear : HousingWire || financial news for the mortgage market
"House Financial Services Committee chairman Barney Frank (D-MA), along with other committee members, sent a letter on Tuesday afternoon to senior servicing executives looking to persuade them to engage in forbearances with troubled borrowers, until the so-called Hope for Homeowners program tied to a recently passed housing bill takes effect on October."
CR writes: "The confessional is still very busy."
What's the patron saint for bankruptcy?
AIG... I love these guys... reliable as ever.
Got SKF ?? Going to be a fun run tomorrow.
Watch that rally in the financials fizzle, in fact it did.
Today !!
Hmm.. shorting is illegal. Who will stop the fall ????
How the US financial system...er Ma Fia coopted Mozilo (beak and tan are identical). YouTube -
Anyone want to guess on whether Barclay's will toss in a shoe tomorrow before the open?
LAS CRUCES, N.M. Pink morning light climbs over the jagged Organ Mountains, casting a glow on the Rio Grande, the lifeblood of this otherwise unforgiving desert.
Outside the door is the historic Mesilla plaza, the best preserved Mexican-style village in southern New Mexico. The bells of San Albino church ring each morning and evening, a fitting reminder that San Albino was the patron saint of the "little people," the sick, the indigent, widows and orphans.
Whose heads are we chopping off? The IRS or the tax cheats? Only one of them deserves it.
AIG was already way oversold. This is going to be a Bonanza. As the chicken little's react, back the truck up and BUY BUY BUY! BOOOYAH!
"Wachovia exits private student-loan business"
Translation: college is no longer a profitable investment for the masses, and we can't afford to back any more losers. If the gub-mnt is backing the loans we're right there, but most of these liberal-arts basketweaving types will be lucky to work the factory floor, if not serve fries.
YouTube -
Read about the flood...
Shutting down student loans will shut down schools, tightening commercial construction lending should stop construction, cutting off car loans will shut down dealers and manufacturers, closing off mortgages will shut down realtors and homebuilders, lower tax collections should shut down state and local governments and tightening credit cards and ending HELOCs should take care of anything else that might have slipped through the cracks.
When do you think we'll get the 40% drop in the markets?
CR writes: "The confessional is still very busy."
I have a favorite deli and there are often lineups to buy stuff. They have a little thingy whereby you can take a number and be served in sequence. Is there such a thingy for the confessional?
and:
" Hmm.. shorting is illegal. Who will stop the fall ????
leftback"
Is naked buying legal? Why cant I get purchased shares delivered to me so that I can have them in my possession and can not sell them until they are in my hot little hands.
Anonymous writes:
When do you think we'll get the 40% drop in the markets?
When the U.S. Taxpayer defaults on loan payments to China, Japan, etc.
Daughter: "Daddy, don't you think about your retirement?"
Father: "Sweety, I have AIG. I don't have to think about my retirement!"
Daughter: "#$%^!"
40% drop, aren't you precious? The floor is in, real, imaginary, contrived, whatever. Floor is in.
I bought about $60k of SKF on Monday. Felt like a donkey yesterday. Don't feel too bad now.
From the Financial Times:
Many of the worlds biggest banks are proposing reforms that would limit the size and scope of their businesses in one of the most dramatic responses to the credit crisis.
The proposals would hold down the number of investors who can buy complex financial products, bring large swathes of the derivatives markets into regulators sights and call on banks to spend more on technology and risk management.
The consequence would be that many of the securitisation businesses that helped fuel the boom on Wall Street and the City of London in the middle years of this decade could face tougher oversight and find far fewer opportunities for growth.
Perhaps the most unexpected proposals involve new criteria for the sophisticated investors allowed to buy complex financial products. Under the plans, even pension funds and other institutional investors would no longer be automatically allowed to buy bonds backed by assets such as subprime mortgages. All but the wealthiest retail investors would be barred from buying structured products, such as auction rate securities, a $330bn market used by municipalities and student loan providers to raise funds.
Isn't AIG one of those "sophisticated investors"? Didn't they just get whacked along with every other "sophisticated investor"?
Curious. These securities are toxic to the entire financial system. No one is smart enough to understand them.
@char
Nice!
Son: "Daddy, I can't sleep. I'm worried about our family's financial future"
Dad: "Don't worry, we have AIG"
Cut to next scene. Dad lying in pool of blood, gun in hand.
CSC -
Regency Laguna Niguel is showing "Forbidden Planet" at 7:30 on Thursday night. Thought you might want to roll one up and grab an actual bag of popcorn.
That, or go watch Pineapple Express.
Might be cool to remember what our forebears considered scary in 1956.
I actually just smoked a phat bowl and watched this cool redneck dude tear Jim Cramer a new one.
YouTube - "Jimmy Christ Superstar"
It's called Jimmy Christ Superstar and no, that's not me. Although this dude looks stoned, I have confirmed that he does not smoke. He does, however, support legalization.
I'm going to look at Pineapple Express. What a rad movie name.
Re: Student Loans -
My prediction - a massive increase in Pell Grants and low interest (maybe even 0%) student loans (government backed) in the near future - college and graduate school affordable to all! Benefits - 1) $$ into the hands of impoverished middle and working class, 2) some improvement in employability with additional education (though this is vastly overstated by politicos), 3) spreads $$ into lots of towns/cities across the country that have colleges/ community colleges/universities. Essentially, a great "liquidity bus" to channel $$ into the economy.
Downside - another body blow to bucky ($$). Still, a better use of tax dollars (we don't really have) than bombing middle east infrastructure...
I'm going to look at Pineapple Express. What a rad movie name.
One of the dudes who wrote it was on Jon Stewart (the only serious newsman left) last night. Not your best role model, but made me LMFAO.
I miss my 20s, they were fun.
My trading account is absolutely LOADED FOR BEAR. To the brim. There is no way in hell we escape this summer without a meltdown. There will be a rush for the exits. Who wants to be holding this bag?
Re: Student loans -
Forgot one other big benefit - causes unemployment rate to shrink, as jobless go back to college/grad school.
Sorry if this is OT. I've been playing penny stocks small-time for 2 years (NFL offseason, need my fix). Everyone knows these are full of scams, but I swear the past two months have opened the fraud floodgates. And it's not even disguised or intelligent scams any more. Pure shameless pump and dump, total disregard for any SEC regs. The FFGO scam going on right now will probably go down as the biggest penny scam in history. Desperate people preying on those even more desperate.
I really should have anticipated this once the gov't made it obvious there were no consequences for the big boys.
Sorry if this is OT. I've been playing penny stocks small-time for 2 years (NFL offseason, need my fix). Everyone knows these are full of scams, but I swear the past two months have opened the fraud floodgates. And it's not even disguised or intelligent scams any more. Pure shameless pump and dump, total disregard for any SEC regs. The FFGO scam going on right now will probably go down as the biggest penny scam in history. Desperate people preying on those even more desperate.
I really should have anticipated this once the gov't made it obvious there were no consequences for the big boys.
What's the patron saint for bankruptcy?
MiTurn | 08.06.08 - 7:11 pm | #
The Apostle Saint Jude Thaddeus is "The Miraculous Saint," the Catholic Patron Saint of "lost causes" and "cases despaired of.
CR writes: "The confessional is still very busy."
"What's the patron saint for bankruptcy?"
Closest to it I can think of is St. Francis of Assisi, who must be the patron saint of poverty. But it was something he welcomed, so perhaps not what you were thinking of.
"The Apostle Saint Jude Thaddeus is "The Miraculous Saint," the Catholic Patron Saint of "lost causes" and "cases despaired of."
I pray to St. Jude Thaddeus every day.
Thank goodness these are the last writedowns.
I have herd it said, that if you bury your AIG stock certificates in a plastic bag and place them underground for 2 years, you will make enough back at that point, to pay for the plastic bags. I am not a broker or saint.
How we doing tonight?
Re: Filed 11/13/06 for the Period Ending 11/09/06
Foreign Life Insurance & Retirement Services operating income reflects strong results in all product lines and growth in annuity assets undermanagement. Life insurance premium growth was driven by increased demand for investment-linked products throughout Southeast Asia and single premium life products through the Japan bank distribution channel. Performance in Taiwan improved due to sales of investment-linked products and improved net investment income, principally from higher seasonal dividend income of $35 million. Results in Japan continue to be affected by increased competition, especially in the personal accident & health market, and the runoff of the higher margin acquired inforce business at AIG Star Life and AIG Edison Life. Operating income for the quarter also increased by $42 million as a result of out of periodadjustments for reinsurance and net investment income.An unfavorable foreign exchange environment continued to affect individual fixed annuity deposit growth in Japan when compared to the third quarter of 2005. However, the launch of an automatic withdrawal rider for fixed annuities helped deposits increase compared to the secondquarter of 2006. This feature has also been successfully introduced in the Korean market. Sales of individual variable annuities increased in thethird quarter of 2006 compared to the third quarter of 2005
CR can we get a Friday Bank Failure Pool going.? I want to put my money on Silver State Bank (SSBX) this week.
"My parents have AIG!"
"You're parents suck!"
Anonymous.
I heard that Clorox is raising prices on its Glad bags by 10% in September. If you want your AIG certificates to pay for those bags you better act swiftly.
OT - the $USD index closed today above its 200dma for first time in two and a half years. This should help our net export position - oh wait
Gavshire Hathaway,
Your very nice to be helpful in sharing that bonus info, I appreciate it so much!
I'm currently looking at the possibility that these AIG sinners will have the same results occur unto them, which occurred unto SCOTTISH RE GROUP LIMITED, but The Devils in the details, don't yah know:
I'm chasing after Satan and the crossed up matters of coinsurance, reinsurance and all the distortion that goes into this sinful fraud:
SCOTTISH RE GROUP LTD (Form: 10-K, Received: 07/11/2008 17:38:57)
For agreements written on a modified coinsurance basis and certain agreements written on a coinsurance funds withheld basis, asset values recorded in the balance sheet are equal to the net statutory reserve fund balances with the assets backing the reserves retained by the ceding company and managed for our account including the reporting of amortized costs and fair value on the portfolio. The amounts in the funding accounts are adjusted quarterly to equal the net statutory reserve balances.
I love the term "Mark to Market". It strikes terror in the hearts of flim flam artists everywhere. The day is coming!
CR can we get a Friday Bank Failure Pool going.? I want to put my money on Silver State Bank (SSBX) this week.
Especially since John McCain's son resigned from the board two weeks ago, after serving on it only six months.
Why is no one one talking about the revenue?? These guys reported 19.5 billion in revenue compared to 31.5 last year and consensus estimate of 31.5 this year. Did the company not open up their doors for a month??? Or, this is really scary, has the market decided AIG is not fit as an insurer? I mean losses are losses and this could be a kitchen sink quarter for the new CEO but a 33% drop in revenue seems on the scale of catacylsmic. If the market gives up on AIG (no one will write business with them), it will make Bear Stearns look like a picnic with Goldilocks.
It seems to me that these ceding companies frontrun accounting fraud and act as a conduit, but it is something that is difficult to ascertain:
For example: The Company reinsures portions of its life and accident and health insurance risks with unaffiliated companies. Life insurance risks are reinsured primarily under coinsurance and yearly renewable term treaties.
I mean really, what does that mean to a poor little shareholder looking for a simple dividend, i.e, are these people selling dope or guns or what?
The losses are a little higher than we would have hoped for, Bill Fitzpatrick, an equity research analyst with Optique Capital in Milwaukee, said of the credit swap losses.
But he still expects the insurer to eventually see some of the unrealized losses reverse as market conditions improve.
The thesis remain the same that these portfolios will ultimately be marked up, Mr. Fitzpatrick added.
Buy f*#^ers buy!!!
October
Oh, I think my Hail Mary Pass on the web just went through, what a wonder!
Here try this: Evaluating Embedded Derivatives under DIG B36 Eric SchueringSOA Spring Meeting May 25, 2006
Scope of DIG B36
FAS 133 provides additional guidance on applying not-clearly-and-closely related criteria (paragraph 13)
Careful consideration should be given to the interplay of variousguarantees Model mortality and associated GMDB in valuation of GMWB, and vice-versa.
With all this bullshit with Level 3 and mak-to-market, who can say what Satan is doing with AIG? Oh my, if I only knew!
A federal judge on Wednesday handed down the first sentences to defendants convicted in a $1.9 billion corporate fraud case that federal prosecutors compared to the Enron or WorldCom scandals.
U.S. District Judge Algenon Marbley sentenced Donald Ayers, a former chief operating officer with National Century Financial Enterprises, to 15 years in prison for his role in the fraud. Randolph Speer, the company's former chief financial officer, received a 12-year sentence.
The sentences were long enough to punish the men, to deter others from committing similar crimes in the future and to respect the law, Marbley said.
Marbley also ordered the men to repay billions of dollars to investors, along with three other co-defendants yet to be sentenced.
Ohio execs sentenced for $1.9B fraud
Not good enough, killing a few of these bastards would deter others from committing similar crimes in the future and to respect the law
This is a bogus number, way too low.
Here's some reasons:
Many insurance companies have direct (not mortgage passthrough) exposure to residential and commercial real estate, equity and debt.
Mutual life insurance companies (like Northwestern) don't report their earnings like public companies. They aren't subject to the same accounting standards.
There's a lot of bad and sinking corporate debt on life insurance company books. Borderline investment-grade and below.
Insurance companies have huge, unhedged exposure to equity markets based on guaranteed returns, like in variable annuity death benefits.
Before this is over, you'll see at least 50 insurance company failures, mostly small hole-in-the-wall companies but very painful for their policyholders (no FDIC). Maybe 1-2 pretty good size failures.
Insurance companies are still in hiding and denial.
TO THE POSTER WHO SUGGESTED I LOOK AT DRY FLY LIQUOR FOR LUCKYS.
I did contact their reprersentative but we cannot use their product. We sell a lot of pints and airline minis in plactic bottles, because our customers fall over a lot.
We didn't have a good fit but thank you for your marketing ideas.
Anon,
That is just huge - anyone catch the conference call on the quarterly results - not covered there?
The Company issues certain variable annuity products that offer optional
guaranteed minimum account value ("GMAV") and guaranteed minimum withdrawal
benefit ("GMWB") living benefits. Under Financial Accounting Standards
Board ("FASB") Statement of Financial Accounting Standards ("FAS") No. 133,
"Accounting for Derivative Instruments and Hedging Activities", the GMAV
and GMWB are considered embedded derivatives that are required to be
bifurcated from the host contract and carried at fair value. The fair value
of the GMAV and GMWB requires significant management estimates and is based
on the present value of expected benefits to be paid less the present value
of fee income associated with the guarantees. The fair value estimate of
the GMAV and GMWB guarantees include unobservable inputs such as
management's estimate of contract holder behavior as well as such
observable inputs as swap curves and market calibrated implied volatility.
The Company also economically hedges these guarantees by utilizing both
exchange traded and over-the-counter index options and exchange traded
futures. Exchange traded index options and futures are marked to market
using observable mid-market quotes while over-the-counter index options are
marked to market through matrix pricing that utilizes observable market
inputs. The GMAV, GMWB and index options are reported in derivative assets
or derivative liabilities in the consolidated balance sheet. The changes in
fair value of the Company's derivative instruments are reported in net
realized investment gain (loss) in the accompanying consolidated statement
of income and comprehensive income.
Calculated Risk: it's like waiting for the rapture.
I happened to buy life insurance this past year. AIG had the lowest rates, but I specifically did not go with them since a lot of the cracks were starting to show.
Rich,
There are state guaranty funds to protect policyholders. Might take awhile to get your money, but I think most are made whole. They are funded by assessments on insurers operating in each state. I think the system has worked pretty well since inception because you haven't had systemic collapse (a la Great Depression) in insurance, since perhaps the 1906 SF earthquake (if even then).
Rich,
BTW, I was addressing your "very painful for the policyholders (no FDIC)" comment and not your overall point about risks facing insurance company balance sheets.
(Be aware that P&C carriers have experienced the last couple years underwriting profits not seen in over a generation, though I think that is starting to erode. Life insurers, which are more of an investment play anyway, I believe operate on much thinner margins.)
WTF?? | 08.06.08 - 9:24 pm |
WTF that is meant for you not to understand. If you new what you were buying you would walk away.......
Fellow Dignitaries, Bloggers, Friends,
All these corporations knew FASB Level 3 accounting was going to be an issue and things like FIN 46, so what happened, they ignored restructuring and adjusting entities in anticipation of this free-fall event? I wonder if these people are not all betting on the downside and pushing stocks as low as they can, while "they" short their own shares. Get real, why would they know in advance that they were going to be burned alive and sit there without a strategy? Huh, huh punk?
WTF?
Maybe they've already shorted their stock and are now positioning themselves for write-ups... we're all suckers...
OT:
Anyone have a euro tracking index similar to the one here for out declining dollar:
http://www.weblinks247.com/indexes/idx24_usd_en_2.gif
Ciao
MS
MS,
With <a href="http://quotes.ino.com/chart/?s=FOREX_EURUSD&t=f>this do?
I swear to god that the XLF will rally on this. This seems to be the MO these days. Bad news is good news and good news is great news. It's a sign the bottom is in will be the spin. Wait for it.
40% drop? I agree - October.
"History doesn't repeat, but it often rhymes".
I can even give you a reason for October - Q3 earnings for the banks and AIG etc., and they will be so bad we may actually see capitulation.
Until then ride the roller coaster. A lot of great trading opportunities. No need to try and take em all, just pick the ones you see clearly.
Watch out for more counter-trend rallies in September.... and more nonsense from HP.
Tomorrow there will be no escape for the longs. Money flows downhill - bonds, gold, oil.....
The reason many past crashes happened in October was that it was just after harvest time. Banks would lend to farmers for seed, equipment etc., in the spring and then demand repayment when the crops came in. The agricultural component of the economy has obviously shrunk over time, so this cycle has become less pronounced. Perhaps the ethanol boom will reinstall it- not sure when corn is harvested - Dryfly?
I wonder, is the rally driven by tech analysis being so popular or by investors still buying into whole VALUE talk?
p.s. the higher the rally the bloodier the October
I think the rally is a product of desperate IBs who want bonuses.
At any rate, it is about time to finally go long on SKF, the hype is inevitable.
"Was Hank Greenberg part of these bad bets?"
The guy is ether in the seven heaven thinking: "Revenge, sweet revenge" or cries a wolf: "Damn, not my baby, not my baby" or both!
Make that 4 visitors online. Time to put the pit bull in the store, and run for the door.
Get real, why would they know in advance that they were going to be burned alive and sit there without a strategy? Huh, huh punk?
Because everyone knew the regulators could be taken hostage with suicide strategies.
The agricultural component of the economy has obviously shrunk over time, so this cycle has become less pronounced.
Heating + fuel costs and their inverse relationship with Christmas consumer spend will replace that nicely. I think November is when it will get really grotesque.
Oooh...well, the Barclay's losses did come in.
Because everyone knew the regulators could be taken hostage with suicide strategies.
Precisely so...all the more reason for stronger regulation from the get-go - don't give the bastards enough rope to hang themselves, or they will. What is it with the GOP and drunks? Permanent enablers. Dumbya does speak truth - pretty clearly - you just have to do a little careful deconstruction to pick out the bits.