1.5 billion is a mere pittance. Meaningless. And soon 1.5 billion dollars will be worth even less. Anyway the market is UP today. Oh ye of little faith. The US economy is indestructible. Buy buy buy.
Pennies From Heaven
lyrics from the Great Depression... when a penny was worth... what? Roughly 1.5 billion in today's dollars? /snark
"A long time ago
A million years BC
The best things in life
Were absolutely free.
But no one appreciated
A sky that was always blue.
And no one congratulated
A moon that was always new.
So it was planned that they would vanish now and then,
And you must pay before you get them back again.
That's what storms were made for
And you shouldn't be afraid for
Every time it rains it rains
Pennies from heaven.
Don't you know each cloud contains
Pennies from heaven.
You'll find yor fortune falling
All over town.
Be sure that your umbrella is upside down.
Trade them for a package of sunshine and flowers.
If you want the things you love
You must have showers.
So when you hear it thunder
Don't run under a tree.
There'll be pennies from heaven for you and me."
Finally, the question must be asked: if the first 7 percent downleg in home prices could manage to trigger
1. Almost $100 billion in write-downs in the banking sector;
2. A 65 percent year-over-year surge in foreclosures;
3. The highest residential real estate loan delinquency rate in 20 years; and,
4. A 20 percent plunge in S&P financials
then what, pray tell, will the next 20-30 percent have in store?
NEW YORK, Jan. 14, 2008 (Thomson Financial delivered by Newstex) -- Shares of Friedman Billings Ramsey Group Inc. (NYSE:FBR) fell Monday after the company said that First NLC, its mortgage origination unit, was filing for bankruptcy as a result of deterioration in the non-prime market.
On Friday after the bell, the Arlington, Va.-based investment banker said the unit would be liquidating its assets.
Friedman said it wouldn't close the previously-announced recapitalization and sale of First NLC, though it has taken steps to limit its exposure to the unit. It doesn't expect to recover its remaining $12 million investment in the divisio
NEW YORK, Jan. 14, 2008 (Thomson Financial delivered by Newstex) -- Shares of Friedman Billings Ramsey Group Inc. (NYSE:FBR) fell Monday after the company said that First NLC, its mortgage origination unit, was filing for bankruptcy as a result of deterioration in the non-prime market.
You know, there's worse things than bankruptcy in the world of modern business.
Big deal - it is only $1.5 billion. Wait till Helicopter Ben is done, we will be carrying around billion dollar bills in our wallets, and McDonalds will offer a bargain burger at only $1 billion (fries not included).
OT - CR and MOM, in case either of you're interested Barry Ritzholz posted an article on the Baltic Shipping Rates Index (BDI) having dropped 4.6% recently, stating that this is evidence that our recessionary slide is being exported to other countries around the world.
Barley, I noticed that as well...no Countrywide press release on their website. Terrible if you ask me. I feel like I'm the only shareholder complaining about the lack of transparency in this deal. Where are the institutions? I guess they ain't complaining 'cos the majority don't want to admit they owned the stock from $43 to $6 and change (I bought at $5.50 myself...lol).
Andrew - Shame on you for advertising this. If word spreads, WS is going to have to change their tune re. US companies will continue to be profitable because of Global growth.
Countrywide's Investor Relations Newsboard...no mention of BoA deal. How come?
It smells to me like a deal where BAC could walk away several months from now for any number of reasons and with very little loss or expense. They are just a front to buy time and see if something else can be worked out. Maybe CFC knows this and is not too happy about it. Maybe their lawyers have told them it would be safer not to post anything.
Based on what everyone is saying, CFC is nearly terminal. So, it serves a purpose for the Fed and banking system to prop up their stiff for a few more months at least. Maybe all this will blow over.
rich - I read the recent financials on CFC as per their post. While dire, I am not sure it is terminal. But, if they did loose wholsale funding, I can see some trouble. One thing is clear they were able to change direction quickly whether this was forced or self motivated is another story. Do you think the call will happen on the 28th?
I feel sorry for underpaid bank examiners who must be spending more of their lives in troubled banks in crisis and cheap, smokey hotels.
Just another $1.5 billion.
rounding down? that was nice of you.
Just another $1.5 billion.
Money money money money money... come on... it's secondary!
Just another $1.5 billion.
What the f%^*%# do loan losses reserves have to do with bank valuation and the credit system - what???
Gosh you bears are naive...
The spread of defaults into auto loans is significant in that just sales and production of autos is about 4% of GDP.
iceman, auto loans are fine, if you don't have an escalade you need to rethink your conservatism. stop talking nonsense and go get me lunch.
CR,
Maybe Citi can raise capital by running a grassroots internet campaign like Ron Paul. I'm sure Mish would be happy to help them out too.
1.5 billion is hardly enough to pay attention to.
OK, please feel free to send me that 1.5 billion if you find it in your couch cushions.
/sarcasm
I hope everyone is borrowing all the cash they need for the next few years.
Cash up!
There will be no credit available for a while, the chinese just returned Citi's application.
Could it be because they loaned money to me too cheap;-]?
I can hardly wait to see the fed response to this weeks confessions.
Someday this war's gonna end...
We'll be bringing the keys to Taiwan with us when we go to the Summer Olympics.
The biggest lobbying group for China's interest will be the US fiancial sector.
No more Mr. Tough Guy pose for Paulson.
Someday this war's gonna end...
But now, it's REALLY my lunchtime.
1.5 billion is a mere pittance. Meaningless. And soon 1.5 billion dollars will be worth even less. Anyway the market is UP today. Oh ye of little faith. The US economy is indestructible. Buy buy buy.
for perspective... $1.5 billion for SOV is roughly equivalent to $24B for Citi. In both cases, approx 20% of shareholders equity.
Scary thing here is that the charge is related to auto loans and a bad acquisition.... not CDOs stuck on the balance sheet.
Pennies From Heaven
lyrics from the Great Depression... when a penny was worth... what? Roughly 1.5 billion in today's dollars? /snark
"A long time ago
A million years BC
The best things in life
Were absolutely free.
But no one appreciated
A sky that was always blue.
And no one congratulated
A moon that was always new.
So it was planned that they would vanish now and then,
And you must pay before you get them back again.
That's what storms were made for
And you shouldn't be afraid for
Every time it rains it rains
Pennies from heaven.
Don't you know each cloud contains
Pennies from heaven.
You'll find yor fortune falling
All over town.
Be sure that your umbrella is upside down.
Trade them for a package of sunshine and flowers.
If you want the things you love
You must have showers.
So when you hear it thunder
Don't run under a tree.
There'll be pennies from heaven for you and me."
Another cull from the WSJ econ blog:
A Bear's Questions
Finally, the question must be asked: if the first 7 percent downleg in home prices could manage to trigger
1. Almost $100 billion in write-downs in the banking sector;
2. A 65 percent year-over-year surge in foreclosures;
3. The highest residential real estate loan delinquency rate in 20 years; and,
4. A 20 percent plunge in S&P financials
then what, pray tell, will the next 20-30 percent have in store?
Good question.
OT: You could almost weep for Bernanke how nothing's going his way.
Was it Bush Jr. who talked about going to Mars?
Continuous Commodity Index
NEW YORK, Jan. 14, 2008 (Thomson Financial delivered by Newstex) -- Shares of Friedman Billings Ramsey Group Inc. (NYSE:FBR) fell Monday after the company said that First NLC, its mortgage origination unit, was filing for bankruptcy as a result of deterioration in the non-prime market.
On Friday after the bell, the Arlington, Va.-based investment banker said the unit would be liquidating its assets.
Friedman said it wouldn't close the previously-announced recapitalization and sale of First NLC, though it has taken steps to limit its exposure to the unit. It doesn't expect to recover its remaining $12 million investment in the divisio
NEW YORK, Jan. 14, 2008 (Thomson Financial delivered by Newstex) -- Shares of Friedman Billings Ramsey Group Inc. (NYSE:FBR) fell Monday after the company said that First NLC, its mortgage origination unit, was filing for bankruptcy as a result of deterioration in the non-prime market.
You know, there's worse things than bankruptcy in the world of modern business.
mortgage debt - check
credit card debt - check
auto loans - check
whats left? student loans?
Countrywide's Investor Relations Newsboard...no mention of BoA deal. How come?
01/09/2008 Countrywide Reports December 2007 Operational Results
01/09/2008 Countrywide Financial Corporation Thirteen Month Statistical Data for the period ended December 31, 2007
01/08/2008 Countrywide to Report 2007 Fourth Quarter and Year-End Earnings and Host Live Webcast on January 29, 2008
12/13/2007 Countrywide Reports November 2007 Operational Results
12/13/2007 Countrywide Financial Corporation Thirteen Month Statistical Data for the period ended November 30, 2007
11/26/2007 Countrywide To Present at The FBR Capital Markets Investor Conference
11/20/2007 Countrywide Comments on Financial Condition
11/13/2007 Countrywide Reports October 2007 Operational Results
There'll be pennies from heaven for you and me."
puravidavid | Homepage | 01.14.08 - 1:31 pm | #
Odd, that song has been running through my head the last week. I guess all the Depression and dollar dropping comments triggered it.
What the f%^*%# do loan losses reserves have to do with bank valuation and the credit system - what???
So, you don't have a clue what's going on, but it's our fault? Are you in management?
Big deal - it is only $1.5 billion. Wait till Helicopter Ben is done, we will be carrying around billion dollar bills in our wallets, and McDonalds will offer a bargain burger at only $1 billion (fries not included).
OT - CR and MOM, in case either of you're interested Barry Ritzholz posted an article on the Baltic Shipping Rates Index (BDI) having dropped 4.6% recently, stating that this is evidence that our recessionary slide is being exported to other countries around the world.
The Big Picture
Barley, I noticed that as well...no Countrywide press release on their website. Terrible if you ask me. I feel like I'm the only shareholder complaining about the lack of transparency in this deal. Where are the institutions? I guess they ain't complaining 'cos the majority don't want to admit they owned the stock from $43 to $6 and change (I bought at $5.50 myself...lol).
Andrew - Shame on you for advertising this. If word spreads, WS is going to have to change their tune re. US companies will continue to be profitable because of Global growth.
That was a good read. I like his blog.
It smells to me like a deal where BAC could walk away several months from now for any number of reasons and with very little loss or expense. They are just a front to buy time and see if something else can be worked out. Maybe CFC knows this and is not too happy about it. Maybe their lawyers have told them it would be safer not to post anything.
Based on what everyone is saying, CFC is nearly terminal. So, it serves a purpose for the Fed and banking system to prop up their stiff for a few more months at least. Maybe all this will blow over.
So it's another Bernie's sequel - Bernie's financial Adventures?
rich - I read the recent financials on CFC as per their post. While dire, I am not sure it is terminal. But, if they did loose wholsale funding, I can see some trouble. One thing is clear they were able to change direction quickly whether this was forced or self motivated is another story. Do you think the call will happen on the 28th?
Not to worry MBA says home prices will start to rise in 2009 , yet another bottom call
"So it's another Bernie's sequel - Bernie's financial Adventures?"
I think more like "weekend at bernies" where they prop up the corpse.
BAC is going to run a gauntlet of MAC possibilities before this deal is done.