IYF Forum Topics
- All Comments on IYF
- General Discussion on IYF
- Financials Have Bottomed? Readers Say We're Nuts [view article]
- Financials: How - And When - We Reached the Bottom [view article]
- Financials Future Still Uncertain [view article]
- The Calm Before the Next Bank Storm [view article]
- Scarlett O'Hara, Doris Day and Financial Market Tumult [view article]
- Apple: Dead Last In Exploited Horse Race? [view article]
- Speed with Which Financials Have Fallen Is Disconcerting [view article]
- Writedowns and Capital Raised by Financial Firms [view article]
- Speculation, Swaps and the Price of Oil [view article]
- Time to Exempt Mortgage Securities from Mark-to-Market Rules [view article]
- Financials Down 6.1% - Like the Days of the Tech Bust? [view article]
- NAR's Lawrence Yun Continues to Mislead on Housing [view article]
loading ...Recent IYF Articles
- Financials Have Bottomed? Readers Say We're Nuts
- Financials Future Still Uncertain
- Financials: How - And When - We Reached the Bottom
- The Calm Before the Next Bank Storm
- Scarlett O'Hara, Doris Day and Financial Market Tumult
- Financial Recovery? Time to Wait and See
- Citigroup Posts Large Loss, but Outlook for Financials Improving
- Apple: Dead Last In Exploited Horse Race?
- All Is Well , Madame la Marquise
- Speed with Which Financials Have Fallen Is Disconcerting
- Full List of Articles »
Wall Street Says 'Oops' [view article]
I followed Barron's recommendation on AIG back in February and invested a considerable amount on the stock. That article has been so misleading that shows how biased are some recommendations of the financial media. I wonder if the author from Barron's did really knnow how to assess a company with such complexity as AIG. Which leads me to think that some articles (such as Barron's) biased to push an equity such as AIG. ReplyMoscardi
How Models Caused the Credit Crisis [view article]
I disagree with the premise that "models" were the smoking gun of the subprime crisis. The real issue is much more mundane - greedy people and corporations. IndyMac underwriting bogus mortgages to unqualified homeowners smacks of pure greed, not "the model said so." When the loans were repackaged, even then it wasn't "the model," it was a lack of oversight, foresight, and understanding by the eventual purchasers - institutional and retail investors alike - what it was they were buying. Whether by stretching the truth or just plain lying, the end purchaser was unaware of the process, because the middlemen, in this case the Street and the IndyMacs of the world, wanted the quick buck.It's the same story all the time. In the end, it will take a massive ideological overhaul of the Street, one that promotes corporate accountability and sustainable business practice over short term gains, to fix it. So really, it will never happen. Every 10 or 20 years this will happen again (see the real estate bust in the 1980s).
(Here's where I take a moment for shameless self promotion) To that end, I say invest sustainable, green, and socially responsible (see my website). It's not a solution, but at least it's a start, and you can sleep a LITTLE better! Reply
How Models Caused the Credit Crisis [view article]
Salmon,You seem to think that a revised rating means that the model has failed. A rating represents the likelihood of default assuming normal market conditions. Since conditions are significantly worse than they were during the rating process, we should expect revisions beyond the historic standard deviation of frequency.
The latin root of a word does not signify a deep immutable meaning.
"Models in general" (such as mechanical models of a bridge, or electrical models of a circuit, or economic models of supply and demand) are NOT to "blame". It seems supersticious to even consider.
Regards,
Max Dama Reply
How Models Caused the Credit Crisis [view article]
There's 2 sides to every story and the truth is probably somewhere in the middle. Seems as if the Center for responsible lending has an "Agenda". IMB's response to what they call a "Hit" piece below.Indymac Bank has updated its corporate blog, theimbreport.com, with its response to a shoddy (at best) hit piece issued yesterday by an organization calling itself the Center for Responsible Lending. This report is essentially a regurgitation of unfounded statements made in lawsuits against Indymac or by those participating in those lawsuits. Indymac was not contacted in advance of its publication or given the opportunity to review or comment upon it or the sources it cites. While this hatchet piece bills itself as an objective case study about just mortgage lender (Indymac), the reality is that this organization has released similar “reports” about many other lenders, including Wells Fargo and Freddie Mac.
While every lender made mistakes (and you can see our 2007 Shareholder Letter for a listing of them), Indymac made over 1.7 million mortgage loans over the past 15 years and nearly 98% of those loans have been successful. Indymac feels that a truly responsible case study would present the facts about these matters, positive or negative, rather than just the unfounded and apparently unchallenged assertions of trial lawyers. Reply
Speculation, Swaps and the Price of Oil [view article]
Dan Walker, this old conspiracy theory that the Fed does what their shareholders want is... well, an old conspiracy theory. Rubbish. JP Morgan et al have no say in what the Fed does.I just read the linked article. Oh man, academia at its worst. The paper reads like a student essay. Those dudes downloaded some data from Haver and slapped some pretty standard econometrics techniques on it. The citations say a lot about the standing of the authors in this field... newspaper articles and a few seminal econometrics articles that one always has to quote when the methods are applied. The authors seem to have no clue of the oil market. They do not demonstrate any knowledge of the data (most of it would have been freely available at the EIA), statements like "OPEC having only 40% of world production" and the finding that the presence of cointegration between longer term oil futures and oil stocks is evidence for hoarding smack of ignorance. They do not even seem to be aware of the role of middle distillates in the current market, they would at least have to acknowledge it, even if they exclude it in their analysis. But their model is too simple to capture the oil market, as far as I am concerned I will not put any value into this paper's findings. Reply
How Models Caused the Credit Crisis [view article]
Greed + stupidity make a dangerous potion. ReplySpeculation, Swaps and the Price of Oil [view article]
Paul,You should read:
www.star-telegram.com/...
and
http;//commerce.senate.gov/pu...
Also, To Brian Pursley,
I do not know where you live...perhaps in some out of the way country where they don't know how to read. Your comments have proved that you know very little about the two authors that I have posted who do know what former US Senator Phil Gramm did to cheat the US public.
Brian...you are the Kafkaesque joke.
And Paul, the Commodity Futures Trading Commission has not done their job properly for many, many years.
The CFTC is part of the problem. Reply
How Models Caused the Credit Crisis [view article]
Interesting article, but very biased. Perhaps the weak link in this scenario could be shared by the originator/broker. Replyspeculator
How Models Caused the Credit Crisis [view article]
I think that Münchau has a point but in my view the global derivatives caused a large portion of the problems. Nobody understands how they will act long-term. ReplyHow Models Caused the Credit Crisis [view article]
and if you look fat and not sexy in victoria's secret underwear immediately blame marissa miller & gisele bundchen! ReplyPursley
Speculation, Swaps and the Price of Oil [view article]
Congress blaming speculators for high oil prices is some sort of sick Kafkaesque joke on the American people. Congress and Congress alone is to blame for high oil prices. ReplySpeculation, Swaps and the Price of Oil [view article]
fxtrader07: I hate to tell you, but the Federal Reserve Bank is a private corporation and JP Morgan is its largest shareholder. Whose interest do you think Ben has at heart?And to Mr. Kedrosky, the author of this fine piece, go look at the volumes. There has been scant volume in the forward months for the last year. The specs who are holding oil for ransom aren't interested in long-dated contracts. They are rolling from the front month to the next the week before the contracts expire. And your comment on hoarding is spot on. But that all may soon end. Reply
Speculation, Swaps and the Price of Oil [view article]
Well, now I'm confused. The Wall Street Journal says that the producers aren't hedging their positions, while just a few days ago the Financial Times reported that the oil companies were buying put options, with "strong interest" in such options for six months to two years out.Am I confusing two different activities here, or are the reporters for one of these papers completely full of it? Are they looking at different data (London vs. New York)? Is there some other "oil producing" group besides the oil companies that the WSJ regards as more valid in the futures market? And what about those puts ... is the FT placing too much emphasis on them, or is the WSJ discounting them in favor of some more esoteric hedging strategy that I'm just too unsophisticated to understand?
I know most of these questions sound more like snark that actual inquiries; but I really want to know ... is there some critical factor that I'm just not getting, or has somebody been fed a line? Reply
Speculation, Swaps and the Price of Oil [view article]
good article, thanks.here you see the fed's additional borrowing facility which were actually meant to help troubled banks and brokers and to prevent a systemic melt-down are flowing probably directly into oil swaps thorugh the likes of goldman sucks and others. want to curb these excesses? closely regulate and control goldman and jpm. In fact, it is my strong conviction that the society and the u.s. economy will be way better off without goldman and jpm chase which are using every loophole and possibility to extract profits on the back of main street Reply
U.S. Bank Dividend Yields Revisited [view article]
I think finanical sector is still not out of woods even after 340 billion dollar worth of writeoffs and around a trillion dollar wipped out of the market capitalization of this sector. There are number of reasons for that1) Securtization cycle is completely broken off, most of the big investment bank/brokers earned a third of the earnings from this. And i don't see this returning back anytime soon.
2) Regional banks still have to recognize all the losses on the loans that are still on their balance sheets and not yet securitized.
3) All the recently raised capital(convertibles/p... Debt) will have a highly dilutive impact on the number of shares outstanding 3-5 years down the road.
4)Banks/Brokerage houses has yet to recognize the losses/reduced earnings due to general economic slowdown
So any recovery before 2010 is highly unlikely for financial sector.
i look forward to the Comments/suggestions from fellow alpha seekers. Reply