Washington Mutual Inc. (WM)

All Comments on WM

  • commenter
    Kinabalu
    Oct 01 06:03 PM
    Paulson and Bernanke: A Conspiracy of Dunces [view article]
    The biggest dunce in the house has been Sheila Bair. Led by a professional academic and bureacrat, its not surprising that the FDIC will not understand their impact on the credit crisis. Their behind the scenes "negotiations&quo... with interested parties in the WM and WB takeovers undercut and eliminated any possiblity of legimate deals being made. The gift of a "well capitalized" WM to JPM, in particular, while the WM CEO is flying from New York to Seattle and a bailout bill is being discussed in Congress, is disgusting. Who will ever buy bank senior debt at 1.25% over Treasurys again?

    I thought I lived in the USA and find out it's Venezuela.     Reply
  • commenter
    Reinko
    Oct 01 05:46 PM
    Paulson and Bernanke: A Conspiracy of Dunces [view article]
    Your step 3 makes some sense; the banks complain that accountancy rule 157 is pro cyclical in nature.

    But first the healing of rule 157 needs to set in.

    Don't forget that a lot of banks used rule 157 in their benifit; they wrote down about 200 billion of their own debt obligations...

    That is about the same size of the reported down writings in the first year of this credit crisis, of course it is rather strange to write down your own debt obligations. This lays the axe at the roots of your credit ratings but the banks did it anyway.

    Furthermore, all attention is now on the normal bank balances. There is a large shadow bank system behind it where the Basel 1 rules for bank reserves simply do not apply.

    The real shit is of course nicely parked in the shadow bank system...     Reply
  • commenter
    nym
    Oct 01 05:41 PM
    Nixing 'Mark to Market' Won't Solve the Problem [view article]
    Stone Fox, how is 'real value' determined? Reply
  • commenter
    Stone Fox
    Capital
    Oct 01 05:32 PM
    My Website
    Nixing 'Mark to Market' Won't Solve the Problem [view article]
    Mark to market is great when we have a market, but distressed prices shouldn't be used to claim a market. In fact, we'll likely find that the big writedown on the WB deal was due to the WM mark downs. Why should they have been used that was a distressed sell? Accounting should always use the real value of an asset not the distressed market value. Reply
  • commenter
    haydete
    Oct 01 04:53 PM
    Paulson and Bernanke: A Conspiracy of Dunces [view article]
    When you have all the inside information that Paulson and Bernanke do, then maybe you'll be smart (but maybe not wise) enough to say whether they are dunces. Until then, we all have to wait for the protest in Congress to stick flowers in the end of the bazooka.

    Greenspan was touted as the money maistro for years... until lately. Maybe the current effort will also get a reversal of opinion and they'll be heroes. You don't know.     Reply
  • commenter
    levin70
    Oct 01 04:51 PM
    Paulson and Bernanke: A Conspiracy of Dunces [view article]
    Michael. If you really think you can do better, please put your hat into the ring when the next administration comes looking for its next fed chairman. Lets see how well you do on the hotseat Reply
  • commenter
    james kar
    Oct 01 04:48 PM
    My Website
    Nixing 'Mark to Market' Won't Solve the Problem [view article]
    A lof the investors blame the current crisis on the accounting standard board. The accounting rules require companies to write down assets to market value, known as "mark-to-market&q... Since there is no market for the mortgage back securities, the banks have to write down to zero. But now the accounting board allows the companies to use their own judgement when assets have no market. When an asset is bad, it is bad and should be written off. So, by changing the accounting rule, companies suddenly can have a good healthy balance sheet because the management has more flexibility in terms of how to value the non-marketable assets. Of course, a mortgage should be worth something if the borrower is still making payment even thought there is no market. The banks can go back to the good old days of banking operation - own the mortgage they created. Then, the banks can value the mortgage based on the future cash flows generated from the mortgage - mark-to-intrinsic value.

    My suggestion is this: The banks should separate the mortgages they own into 3 groups and value them separately. (1) mortgages they want to hold until maturities, (2) mortgages they know are bad and should be written off, and (3) questionable mortgages that they want to sell. Then, we create an exchange to trade such mortgages. The global investors are smart enough to value the questionable mortgages in an open exchange condition. Now, the banks can either sell the mortgages or market them to the market.

    Reply
  • commenter
    ElizaJane
    Oct 01 04:47 PM
    Paulson and Bernanke: A Conspiracy of Dunces [view article]
    Your bottom up plan is the only one that makes sense. The $700B bailout should be for Main Street NOT Wall Street. If banks don't want to cooperate, let homeowners apply for grants to cover amount they are underwater. Then banks would be willing to re-finance the remaining loan balance of no more than 80%LTV. When banks are lending again, home prices should stabilize. Without banks lending, main street grinds to a halt. Taxpayers will support a plan that truly helps homeowners and gets credit flowing again. For years already, banks should have been modifying loans to avoid this crisis. And what's the big rush for a vote? Why can't it wait until after the election? All the major investment banks have already failed. This is exactly like the rushed vote to start a war in Iraq. Congress should not willy nilly go along with Bush. Vote for a bailout after Nov. 4 if they have a plan that really makes sense for taxpayers. Reply
  • commenter
    concerned
    reader
    Oct 01 04:45 PM
    Nixing 'Mark to Market' Won't Solve the Problem [view article]
    Repealing mark-to-market is appealing in its simplicity, but, it may not help. I can't imagine investors rushing back into financials that have taken huge write-downs just because those banks can now artificially inflate the value of their assets. If there is no market for exotic, toxic "assets", maybe they are indeed worth zero, and maybe the market value is correct after all... Reply
  • commenter
    tshk1221
    Oct 01 04:37 PM
    It Did Happen! - Cramer's Mad Money (9/29/08) [view article]
    Sorry to hear that scholar..

    1. Never listen to TV stock masters. They are showpersons, not a rich stock investor.
    2. Never listen to chart masters. They are picture drawers, not a rich stock investor.

    Scholar, if you want some important stock investment tips from me, send me a response, Yes, and I will get you some tips that might help you. Some of the examples of tips you will get from me will be:

    1. Keep the first mistake forever. It will be a Father. Keep the second mistake forever. It will be a Mother. Keep the third mistake. It will be your son. Keep the third mistake. It will be your daughter. Without mistakes, there are no successes. Mistakes make successes. Successes will make mistakes. Keep the stocks you buy forever. Never sell them. Do you want to sell your Father? Do you want to sell your beloved son and daughter to the wolves in the stock market?
    2. TIME = WEALTH. Only TIME will give your WEALTH when you hold them forever (TIME).

    And so on..Let me know, Scholar.     Reply
  • commenter
    Tumbler
    Oct 01 04:25 PM
    My Website
    Paulson and Bernanke: A Conspiracy of Dunces [view article]
    The $700 billion would be better spent as a direct grant to U.S. citizens. Rest assured, they will sort the chaff from the wheat of this economy.

    But any bailout should exclude anyone financially associated to 535 particular individuals in Washington, D.C.     Reply
  • commenter
    turkeyeyes
    Oct 01 04:21 PM
    Paulson and Bernanke: A Conspiracy of Dunces [view article]
    The disaster didn't come with an Owner's Manual. Reply
  • commenter
    winslow
    Oct 01 04:14 PM
    Paulson and Bernanke: A Conspiracy of Dunces [view article]
    Let's face it, all the academic theoretical economists have no idea how to deal with this real world event Reply
  • commenter
    V Dub
    Oct 01 04:11 PM
    Nixing 'Mark to Market' Won't Solve the Problem [view article]
    Marking to Market is not a viable solution either; this way of accounting makes the assumption that the asset marked to market would be ready to sell almost immediately. However, with the current residential housing market the way it is, there are no buyers. Therefore, the marking to market on this paper is unreasonable.
    The bailout plan is a viable solution as the government would be able to purchase many of these loans, and can then sit on it until the economy improves. This way, Banks would benefit, and would be able to continue doing business by lending money to all the avg Joes and their businesses on a day to day basis. He, in turn, would survive and continue paying his mortgage, paying bills and living his life in general. The trickle down effect would at least help sustain our weakened economy from becoming weaker.     Reply
  • commenter
    Ishortyou
    Oct 01 04:02 PM
    Do Dividend Cuts Offer a Clue to a Bank's Stability? [view article]
    Wachovia got rid off the prior toxic risky wasted bank subsidiaries and kept the good ones. Now it can start from scratch to build a new banking subsidiary with safe practice together with its remaining good outstanding subsidiaries. The current subsidiaries of Wachovia make it look like “Merrill Lynch without the toxic risky waste”, good job from management it separated the good bank from the bad bank overnight, plus its CEO Bob Steel is one of the top rated mutual fund managers. Wachovia will keep the valuable human resources and the talent that have expirience in the banking business saving them for the new banking subsidiary. Buying the municipal bonds or the auction rate securities will give the inflow of cash as long as its hold even to maturity. Some investors are taking money away from Hedge Funds going wild and putting that money into accounts manage by people that know what they are doing, Bob Steel is one of those people that know what they are doing, dont be surprise some of this money will go to Wachovia subsidiaries. Earnings will be adjusted accordingly, like simple arithmetics they will manage its expenses vs its earnings to come ahead in capital and start piling up cash (saving cash a hard job for most of us that live on debt), this new cash will give them the jump start of a new banking subsidiary without even thinking about to sell its remaining subsidiaries.Forgot to mention that Wachovia owns a hudge Insurance subsidiary which is making money and has sound book of business. Lehman debt is bonds most of them senior, as bankrupt as Lehman is those bonds get paid. ARS are Municipal Bonds as bonds they get paid, hold into maturity they get paid in principal, those ARS are cash flow. Preferred dividends will get paid accordingly because the holding company does not own the banking subsidiaries anymore so modification are going to be made. Getting rid off the toxic waste risky bank related subsidiaries is a good strategy and converting the remaining broker one to a new bank subsidiary with clean sheets is a good one too.


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