Bear Stearns Companies Inc. (BSC)
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- All Comments on BSC
- General Discussion on BSC
- Lloyds Buys HBOS: Good Deal or Bad? [view article]
- Combating Cascading Short Spirals [view article]
- Financial Landscape: Writedowns, Losses and Capital Raised [view article]
- Nine Months Later: Some Annual Predictions from the Financial Press [view article]
- What Happened to the Fed's $1.816 Trillion Lifeline? [view article]
- 3 Things America Needs to Do to Get the Economy Back on Track [view article]
- The Coming Crash of 2008: A Result of Overleveraging [view article]
- Putting the Perception and Reality of the Financial Crisis Into Perspective [view article]
- Bear Stearns’ Bailout by the Fed, JPM: A Century Old Conspiracy [view article]
- Where's the Bottom? Still Anybody's Guess [view article]
- Lessons From the Banking Meltdown [view article]
- Investment Bank Crisis: The Greatest Show on Earth [view article]
loading ...Recent BSC Articles
- Combating Cascading Short Spirals
- What Happened to the Fed's $1.816 Trillion Lifeline?
- 3 Things America Needs to Do to Get the Economy Back on Track
- Putting the Perception and Reality of the Financial Crisis Into Perspective
- Where's the Bottom? Still Anybody's Guess
- Lloyds Buys HBOS: Good Deal or Bad?
- Should I-Banks Trade Publicly?
- Nine Months Later: Some Annual Predictions from the Financial Press
- Will Lehman's Bankruptcy End the Moral Hazard?
- Buyouts and Shakeups: How the Financial World Is Changing
- Full List of Articles »
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Book Value Can Be Deceiving for Financials [view article]
In response to the first comment, Manifestor is correct, I was referring primarily to the subprime mortgage resets, which are estimated to peak this year (though quite a few will not reset until 2009). The government-sponsored, but voluntary, "bail out" plan may postpone the bad news on some of these, but that will only be a drop in the bucket (and may only serve to distribute that bad news over a longer timeframe).Having said this, some will then argue that all this information should already be priced into the derivative instruments built upon these mortgage loans and, consequently, into the share prices of the firms holding those derivatives. However, if the crisis of recent months has shown us anything, it is that even the "experts" do not have a handle on the full financial impacts of impending defaults.
This, in turn, will continue to affect overall willingness to extend credit, with all the associated second level effects on the business environment. Though I am not at all predicting the end of the financial world (far from it!), this is enough of a crisis for me.
Therefore, I agree with the second comment that this has gone beyond subprime; the "bursting" of the housing bubble, coupled with concerns about the quality of other credit sectors, will continue to exert a bearish influence for a while. I agree that the market has further to go before reaching a bottom...
For more of my perspectives, I encourage you to visit my blog at vestopia.com at your convenience. Reply
Under The Radar News - Friday [view article]
Level playing fields are great and all, but given the somewhat suspect (moral/ethical) value sytems of many of the sovereign-wealth sources, I'd prefer the level playing field that favors the U.S. just a little more than of late. I don't really see the U.S. striving to instigate the tenets of tyranny, through economic manipulation, or any other means. But I do see that as a possible consequence of many near/mid/far east capital injection sources. ReplyA Most Bearish View on Bear Stearns in a Bear Market [view article]
helplessobserver hit the nail on the head - 100 graphs and data to back it up looks great but pissing off customers as much as BSC has done is more than enough to destroy their businessNo need to say more... Reply
Book Value Can Be Deceiving for Financials [view article]
This "subprime" crisis is nothing of the sort anymore. The consumer is tapped out after living well beyond their means for the past few years and the Housing Bubble is going to be largely responsible.When prices ran to historically high and absurd levels consumers not only overextended themselves by buying homes they couldn't historically afford through traditional means, but current homeowners also refi'd their existing homes to the max in order to spend this new found wealth.
Why not max out that HELOC? My house will be worth 20% more next year!
People are just starting to talk about credit card defaults and just realizing that other things like car loans are probably next...
People are just so anxious to find that bottom after 2 tough weeks that there probably will be a bounce, but I don't think a bottom will be close until 3Q 2008.
Reply
Book Value Can Be Deceiving for Financials [view article]
Can you (the author) explain why you think "the worst of the mortgage crisis is yet to come". Are you referring to the adjustable mortgage rate resets and the coming quarterly write-downs or do you foresee additional factors that trigger more crises. ReplyA Most Bearish View on Bear Stearns in a Bear Market [view article]
Bear Stearns has smart people and good technology. Unfortunately BSAM is very tarnished and the mortgage sector is not doing well either(I assume for at least one year). I'm confident they lower risk and expenses, but not that they can find new ways to earn money.. Bear Stearns will most likely be acquired. Replyrver
A Most Bearish View on Bear Stearns in a Bear Market [view article]
My pay grade is not high enough to fathom all this data, but I know a universal truth. Every business needs loyal customers to operate. BSC has crapped on the customer's plate and driven them away gagging. Who in their right mine would do any business with a company that has treated them so harshly? The old customers are now legal advesaries clawing to get any money back they can. ReplyUnder The Radar News - Friday [view article]
What's wrong with sovereign-wealth funds? When USA was buying up foreign banks, directly or indirectly funded by the government, no one raised any issues. Wake up. Let's have a level playing field. ReplyUnder The Radar News - Friday [view article]
Great information as always. Thank you. Replyks.com
Is There A Bull Case for U.S. Financials? [view article]
Excellent analysis. Thanks! ReplyJim Cramer's Mad Money In-Depth, 1/10/08: Bottom's Up [view article]
Jim pay attention to Mike Perry CEO of IMBwww.indymacbank.com/
IMB own this Gem:
www.financialfreedom.c.../
Explanations...
"With that said, management and certain key employees (about 130 employees total) have over $40 million in the deferred compensation plan, and the company has arranged to be able to “open this plan up” and for individuals to be able to use these funds to purchase IMB stock….and several of us, including myself, plan to do this (personally, I am planning to invest more than $1.5 million)."
Shareholder’s Email:
Mike,
It’s been some time since we’ve had a chance to meet and talk. I’m a shareholder once again … While I realize that the decline in IMB’s stock price has been painful to you in many ways (not just financially) I think there can be no stronger message about the viability of IMB as an institution than significant insider buying at these depressed levels. If management can’t step up at these levels, then imagine what a “leap of faith” it must be for outsiders to purchase the stock at these levels. Thanks for taking the time to read my email in what must be an incredibly hectic time for you. Best of luck.
Mike Perry’s Response:
I completely agree with the point of your note. I think you know I bought $1 million of our stock earlier this year at $29. In addition, we have had a lot of other managers and some directors purchase this year, too.
Also, management and the board have lost more personally this year than anyone else by far…as most of us have not sold any stock or options in 2006 or 2007 (no sales from the CEO, President and CFO during this time). As a result, most of us are not in a personal financial position to purchase shares…even though we would like to.
With that said, management and certain key employees (about 130 employees total) have over $40 million in the deferred compensation plan, and the company has arranged to be able to “open this plan up” and for individuals to be able to use these funds to purchase IMB stock….and several of us, including myself, plan to do this (personally, I am planning to invest more than $1.5 million).
Unfortunately, our window for insiders to trade IMB stock is currently closed.
I would expect that the window will reopen once we release 4th quarter earnings in late January, and I would expect to see myself and other insiders purchase in a material way (for management) at that time. I hope that makes sense.
mike
www.financialfreedom.c.../
Unlocking of Value
Another intriguing part to Indymac thats not well appreciated is a business it owns, a reverse-mortgage originator called Financial Freedom, that sits on its books for $80 million. Financial Freedom is the largest player in the reverse mortgage space. This is an area of tremendous opportunity and market focus. As the population ages, the reverse-mortgage business has been booming and is widely expected to grow at 20% or more annually for years. There lately been a lot of interest both from private equity and strategic buyers. For example, earlier in the year Seattle Mortgage, the third-largest player, was bought by Bank of America.
Indymac had bought Financial Freedom from Lehman Brothers for $112 million in 2004. The acquisition has been a home run: last year First Freedom earned $54 million. Should Indymac decide to sell this business, it’s not hard to imagine a price of, say, 15 times trailing earnings, or $800 million. To put that into context, Indymacs total market capitalization is $420 million. For myself, I'll be delighted to see the company sell a minority stake to show the value of this business. Reply
The Danger from Bear Stearns' New CEO [view article]
Well Barry, you still refuse to do your homework so let me give it once more to you:Go to the Federal Reserve 'flow of funds' page and here is the link:
www.federalreserve.gov...
Go to the one last column (total debt of the US financial sector) and observe we have Q on Q the next:
Total debt Q2 = 14855.0
Total debt Q3 = 15435.3 billions of dollars...
Well Barry, since you are only in the denial stage, let me do the simple to understand calculations for you:
15435.3 /14855.0 = 3.9% more debt in just one quarter.
If economical conditions stay the same in 2008 (and there is nothing that points to something else) we have for the full year 2008:
1.039^4 = 16.6% more debt needed.
This amounts to something like 2500 billion more debt needed and I only wonder when you will leave your state of denial...
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If Presidential Candidates Were Stocks [view article]
Correction:The phrase (Dubya visit to Israel is guided by just 40 thousand of high explosives via air power today, thus relating politics and killing effeciently)
Is replaced by:
(Dubya visit to Israel is guided by just 40 thousand pounds of high explosives via air power today, thus relating politics and killing effeciently)
In this regard a pound is about 450 grams so we have about 18 thousand of kilo's of high explosives while there was no monitoring of the thing known as 'collateral damage' on the 43 targets of today...
Reply
If Presidential Candidates Were Stocks [view article]
This is funny because I am arguing for a lot of years already the the US military should get a Nasdaq stock listing so the 'going for oil' thing in Iraq finally made some sense...Why not? They are technically highly advanced (just look at their air wing), they are highly innovative (Dubya visit to Israel is guided by just 40 thousand of high explosives via air power today, thus relating politics and killing effeciently) and most of all: They are the Power and the Glory.
Now this is better than gold, gold is just a stupid metal that is not highly innovative and in the future there are lots of other nations that need to be freed and, just by the way, have some commodities.
All these idiots that say it should not be Nasdaq listed, well they are just so pre 9/11.
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The Danger from Bear Stearns' New CEO [view article]
Oh, excuse me. They call it "mark-to-model.&q... Similar shit, similar pile. Reply