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Bankrupt lender Thornburg Mortgage - one of the biggest casualties of the subprime housing...

Bankrupt lender Thornburg Mortgage - one of the biggest casualties of the subprime housing crisis - is seeking approval to sell its $11B mortgage servicing portfolio to a unit of Credit Suisse (CS), winner of a sealed-bid auction that drew wide interest. PennyMac (PMT) is the back-up bidder. (previously)
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Comments (2)
  • Tom Au, CFA
    , contributor
    Comments (6780) | Send Message
     
    Another one bites the dust.
    5 Feb 2010, 03:56 PM Reply Like
  • Jeff Nielson
    , contributor
    Comments (2464) | Send Message
     
    Presumably, if such an auction REALLY DID draw a lot of bidders then those bidders would be bidding 10 or 20 cents on the dollar for these "assets" - if that much.

     

    This again raises the question of what would be found if an accountant ever undertook a REAL valuation of the "assets" of Wall Street banks.

     

    With their entire balance sheets leveraged by 30:1, many of their bets would go to zero with only a 5% decline on the underlying assets. With the U.S. housing market down 30% and the commercial real estate market down 40%, it would be very interesting to know how many TRILLIONS in losses is still being hidden.
    5 Feb 2010, 04:03 PM Reply Like
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