johnthebear

Game Over, CIT

That news should bring the market back to reality. I understand that without bailout, 300,000 retailers and 760 manufacturers could fold.

You have it right... no unions involved,

so low down, cheap politics if you ask me!

Looks like a bad time ahead for IYR.

Are Markets 'Decoupling' - And How Would We Know?

Time is short.. even overdue for continuation of the bear downturn, in my opinion. Yep, I am short and the pain is severe at this point. Enjoy your gains while you can, but don't put off taking a profit too long!

The Coming Depression in Commercial Real Estate

It will be interesting to see on May 4th if "off balance sheet items" are required to be shown on the balance sheets of the 19 largest banks?

If that happens as I expect it will, almost all of the biggest banks will require extra capital to survive.

This means that lending capacity to aid REIT's short term cash needs will not be available. Look for more huge stock sales of REIT's so that dividends can be paid.

Look for IYR to take a big hit, even at this low level.

off-balance sheet items Definition | Business Dictionaries from AllBusiness.com

The Murky World of Off-Balance-Sheet Items (Part 3) -- Seeking Alpha

PEU Report: Off Balance Sheet Items: Big for Banks

Does anyone have a clue of what "OFF BALANCE SHEET" items means? Bloomberg reports that the range is from $700-900 Billion dollars!!!

I remember ENRON had a lot of "off balance sheet items that the public did not know existed, which led to it's dramatic death.

The stress test is supposed to require these items to be revealed to the public and they expect most of the 19 banks to need more capital!

Looks like a busy week ahead trying to unlock this story.

Open Letter to SEC: Wall Street's REIT Bait-and-Switch

A lot to digest here... bottom line, IYR and the REIT's are manipulated daily.

It is clear that capitalization rates have more than doubled on commercial real estate from the glory years of 2005-2007, yet none of the loss in market value seems to reflected in annual reports or the financial press. It seems to me that the huge sale of stock we are now seeing is only to raise cash that can be paid out in dividends.

WILL THERE EVER BE MARK-TO-MARKET ACCOUNTING OF REAL ESTATE PROPERTY VALUES?

Talk about a HUGE PONZI SCHEME!

Time for the SEC to investigate and not keep sweeping this scandal under the rug.

Office REIT Outlook Still Bleak

I would be interested in knowing how revised mark-to-market rules relating to banks are being handled by the REIT's?

Capitalization rates are rising significantly and commercial property values are falling. Is there anything the investor can do to learn the true nature of their real estate investments?

Extreme CDO Leverage to Create Another Deleveraging Storm

Outstanding piece of work. I would like to understand better the expected timing of the deleveraging that will occur and how it will relate to TARP funds. Can't believe all IYR assets will be bailed out.

Thursday Outlook: Commodities, Global Markets

Any fresh ideas on how the SRS/IYR double shorts are made to function as they do? I finally came to understand that SRS is useful only for short term trading, that longer term price trends of low IYR and high SRS prices are not necessarily going to repeat themselves in any exact way.

Thanks again for your superfine charts. They are a big help to me.

Ultrashort Real Estate Drop Demonstrates Unlimited Faith in a Recovery

It would be truly incredible if someone would explain the typical investor how the SRS vs IYR double short functions. What makes is it work? After Maddoff, I wonder if we are all being sucked into another big web of fraud?

I have asked this question several times, but no one seems to know.

I am shifting from SRS to buying calls on SRS. The high volatility should pay off with an even bigger multiplier, if I am right. I bought $75 strike Feb 09 calls and hope for the best. Right after I bought my calls the price of IYR dropped below $50 and my calls dropped from $6.5 to $4! Boy, this is a rough game!

China Isn’t Losing Its Competitive Edge

Thanks again Michael for your keen insight and another of your articles that reveal the possible future in dealing with China. There is much to be concerned about as this monster global crisis becomes more acute.

China: Is Domestic Demand Rising or Declining?

I follow FXI/FXP and was very surprised at the disconnect the past couple of days. I expect that FXI will head back to 19 tomorrow as the economic reality of reduced earnings forcast are put back into investors equations along with the slight reduction in interest rates around the world. The question I face, is will FXP resume it's loft status that corresponded with the FXI a few days ago?

Earnings and a bottom on the home price decline seem more important than interest rates at this point in time. It is hard to understand the logic for the market being up today.

I like the idea of making new low interest 30 year mortgages available to qualified buyers, but do not like the idea of bailing out mortgages to those that had no business buying a house in the first place.

It seems that the US led the world into the crisis and it will not end until the US is able to slow the drop of residential real estate prices, which will be tough to do if unemployment starts rising sharply.

Waiting in the wings is the problem of overvalued commercial real estate which will hit the financial press in the next few months. How to find financing for buyers looking to buy real estate with huge loans of failing REITs and hedge funds will be a monster of a problem, and could long delay the turn around, both for US as well as China.

Bespoke's International Market Snapshot

In my opinion ^ssec and ^hsi have at least another 10%-15% drop ahead. I have puts in FXI with a $20 strike for Jan 2010. We are looking at a bear that last at least twice as long as the last decline 2000-2003 due to the world wide loss of $25 trillion in equity capital. China and Russia billionaires are down big time... No one can say how bad it will get.

Historical Bull and Bear Markets for the Dow: 1900-Present

It would be nice to see detailed charts during the 1925 to 1940 period, overlaid with the Dow and (Nasdaq adjusted for dates).

I suspect that the 2000-2003 bear will be short in comparison with this financial disaster since the basic financial system remained sound, world wide. Not so this time.

Now we have to recover with badly wounded banking system, looking over it's shoulders at regulators trying to make sure every loan is justified. Good thought, and necessary in view of the abuse in Congress and with powerful corruption caused by Acorn along with Feddie and Fannie.

Now, lenders are crippled with shortage of qualified employees to make loans, review appraisals and process the loans. Also, I cannot foresee a return to the securitization of mortgages any time soon, so lenders that make the loans will probably have to live with them for the duration. Maybe 10 years from now there may be something similar, but hopefully with strong regulation.

Tuesday Outlook: Commodities, Emerging Markets

David, I have noticed a disconnect between FXI and the double short FXP for the last few trading days.

FXI moved down today, but FXP barely moved. Any idea why this happened or how FXP climbed to 219 just before the close on October 9th while FXI moved to 24.31? I am heavily invested in FXP and it looks to me like the gap on FXI at 28.38 should fill soon. But, will FXP give the appropriate move up?

SRS and IYR are moving as expected with the 2:1 ratio.

Your thoughts would be greatly appreciated.

Time to Pick Up the Pieces of the Global REIT Thud

It seems to me that you have forgotten about mark to market accounting which will impact those formerly strong appreciation figures. There will be a time for REIT's but not for a couple of years, IMO and at a much lower price.

Earnings Preview: General Electric

Any idea how mark-market will affect commercial real estate loans and property held by GE?

Can we expect an honest report?