johnthebear

Total Rating:
+1 / 0

256 Comments

    • Sun Feb 10th 14:43 PM | Rating: 0 0
      Commented on:
      A U.S. Slowdown Won’t Help China
      It is my understanding that manufacturing production capacity has dramatically increased to an excess, meaning any slowdown of exports from China will result in a very sharp downturn and inventory build up.

      To me, that means that FXI returns to the $60-70 range in the coming months, a sharp drop from the current $140 level, and a lot lower than the $220 range enjoyed a few months ago. What goes up too quick, usually falls hard and fast.
      View article »
    • Tue Jan 8th 21:21 PM | Rating: 0 0
      Commented on:
      When the Dollar Crashes, All That Glitters Will Be Gold
      What will be the effect on the dollar to bail out Countrywide?

      Who will bail out the credit swap defaults?

      Who will buy the REITS when commercial buildings drop in value and investors can't get out of their funds?

      So if the FED and Treasury are the answer, what will that do to the dollar?

      Looks like gold is the only way to protect yourself. I bought GLD today.
      View article »
    • Sat Jan 5th 16:48 PM | Rating: 0 0
      Commented on:
      God Told Me The Market Will Crash Soon - Pat Robertson
      Liberals are all alike.... hate to admit that there is a God.

      Why can't liberals be happy that there was no nuclear explosion in their home town rather than try to tear down a man of GOD, a follower of Jesus Christ.

      I believe that he is right and I have bought a lot of puts to profit from the falling stock prices. If you are smart, listen to Pat!
      View article »
    • Thu Jan 3rd 21:08 PM | Rating: 0 0
      Commented on:
      Commodity Super Cycle: Ready to Rumble in 2008
      So when does the China government take a serious look at inflation? When do they raise interest rates to reduce inflation and slow their economy? Will it take a major food riot to make them realize how serious this is for the stability of their government as well as the world economy?

      The Japan market was very inflated and their market reached 40,000 in 1990 and just today fell below 15,000. A similar move is likely for China IMO.
      View article »
    • Thu Jan 3rd 20:15 PM | Rating: 0 0
      Commented on:
      Chinese ADRs Post Big Gains in 2007
      With such extraordinary gains, how long before the correction?
      View article »
    • Sat Dec 29th 00:06 AM | Rating: 0 0
      Commented on:
      8 Key Concerns and Questions for 2008
      Global recession is a real possibility that everyone is afraid to talk about... scared that the discussion will show that the emperor has no clothes!

      It is amazing that the China market is so completely given a pass...just like the 2000 tech bubble. The Fxi will drop from 170 to 70 in a matter of a few months as the global impact becomes more real.
      View article »
    • Fri Dec 28th 23:53 PM | Rating: 0 0
      Commented on:
      Uncovering Material Information at Merrill Lynch
      So did you see the story about the First Republic suit? The sale was stock and cash for $1.8 billion last January. It was clear in November 2006 that 2007 was going to be a bad year for CDOs. I have a friend at Merrill that told me in Nov. that the subprime problem was less than 1% of the market and would have no effect on stocks this year. I bought puts, disregarding the inside info at Merrill.

      The other shoe will fall when many smaller banks all over the world take writedowns and all residential lending dries up except for the most qualified buyers. When you lose several trillion dollars of lending capacity, it has to lead to a recession for more than just banks and real estate. It is amazing how little info about lending practices and real estate inflation is discussed by our media.
      View article »
    • Wed Dec 19th 23:15 PM | Rating: 0 0
      Commented on:
      Housing Market Tracker - Subprime Review
      Then, when you put into the equation that most stock indexes around the world are below or only slightly above their 200 day moving average, it really gets scarry. No wonder everyone is pretending that we are not already in a recession.
      View article »
    • Wed Dec 19th 00:22 AM | Rating: 0 0
      Commented on:
      Waiting to Pounce on Asia Once the U.S. Bursts
      Unfortunately you are correct in your analysis in my judgment. The subprime issue was clearly visible in October 2006, but almost everyone except you and me and Goldman Sachs ignored the problem. I understand GS went short on mortgages, smart move.

      I was shocked when I recently learned that there is a shadow banking system created by the securitization process, in which $10 million of real money supports mortgages and CDO's of $850 million. There is no regulation of this money creation. Now I understand where all the excess liquidity came from that pushed up both commercial and residential property values. Sure makes REIT's a huge risk in my judgment.
      View article »
    • Thu Nov 15th 04:31 AM | Rating: 0 0
      Commented on:
      Thursday Outlook: Sectors and International
      Darn, there are so many shoes still hanging by a thin lace, and who knows what they are tied to!

      No one is talking about CDO's...they are focused on the obvious residential mortgage problem and ignoring the huge commercial loan problem which will hit the fan as vacancy begins to rise. Hard to pay a 110% mortgage with increased vacancy.
      View article »
    • Tue Nov 13th 03:25 AM | Rating: 0 0
      Commented on:
      Double Down On This China Fall
      What is the point of the story? This is really a short sighted way to play the game on FXI. "The new ETF, ProShares UltraShort FTSE/Xinhua China 25 (FXP), seeks daily investment results that correspond to twice the inverse of the daily performance of the FTSE/Xinhua China 25 Index."

      Why not buy puts on FXI? The bubble is so big, it seems likely that it could drop back to 60 while trying to find a stable bottom by January 2008. When you take a close look at the chart, puts are very cheap and offer huge multiples of potential. profit as FXI drops toward 100.

      I own puts for Jan 08 and jan 2009 at 60 and 70 strike price for what it is worth. Yes, I have a BIAS, but one that is based on close market observation.
      View article »
    • Thu Nov 8th 05:24 AM | Rating: 0 0
      Commented on:
      Commercial Real Estate Heads South
      Take a look at "National Real Estate Investor", Oct. 07, page 28 for something that will really shake you up. 59% of commercial loans in first half of 07 were interest only and LTV ratio exceeded 105%. There are many charts and tables that document the danger in the commercial market for CDO's. Your charts and tables above do a good job of outlinging the size of the risk and who carries most in this country. The thing that is most dangerious and not discussed in our financial press is the risk in German, English, Spanish banks that are just as bad as our worst. England Northern Rock is the tip of the iceburg.
      View article »
    • Wed Nov 7th 22:14 PM | Rating: 0 0
      Commented on:
      Don't Say Citi Didn't Warn You
      I was reading about "tranche's" today in wikipedia and found an interesting discussion of how CDO are sliced into 4 classes, with the "bank" holding the slice with the first 25% of the loss based on being the slice with the greatest risk. So does this mean that Citi is absorbing all of it's 25% share in all of it's many bundles of commercial and residential mortgage and debt obligations or only 10% of what is possible? That would really be interesting to know. If the loan has a 110% LTV ratio, (no equity by the mortgage holder, how can there be less than a full 25% loss of it's share? What about the poor saps that own the other 75%? Where is that recorded?

      Also, commercial mortgages may not be in default now while the economy is still buzzing along, but with very low cap rates (equity return sometimes less than the mortgage interest rate and a 110% loan) and purchased while still 10% vacant, and assumption that with creative leasing the buyer plans to increase rents at 5% per year in a slowing economy.... I just wonder when they plan to recognize this potential loss? This problem goes way beyond Citi.... on to the big German banks that have been buying US real estate because of favorable currency ratios. Funny, no one is talking about this risk. Seems they would rather blame only the USA for creative financing gone amuck. Might be time to short some of those banks as well.
      View article »
    • Mon Nov 5th 11:39 AM | Rating: 0 0
      Commented on:
      Credit Crisis + Mortgage Mess = Deflation?
      "grab a bottle of Maalox"... is not enough! The "National Real Estate Investor" Oct. issue on page 28 has a chart that shows 59% of commercial mortgaged property was "interest only" loans and the LTV ratio ranged from 105% to 113.4% based on S&P, Fitch and Moody's ratings.

      What happens when commercial property vacancy increases in a slower economy? How will Citi deal with $43 billion in CDO's and CMBS obligations? They are lower than junk bond status in my judgment. At least with junk bonds there are company financials and a product you can understand, while these commercial real estate loans are based on 5-10% annual rent increases!

      I don't hear anyone talking about this massive, world wide problem. Nor do I hear about similar problems with both commercial real estate in Europe. There is already major overbuilding and declining prices in residential real estate in most European countries which you have reported, but the whole mess is unimaginable. Not enough Maalox to go around!
      View article »
    • Mon Nov 5th 00:58 AM | Rating: 0 0
      Commented on:
      Rate Cut: Is it Two and Done?
      You nailed it. Can't wait to see your analysis of Commercial Real estate.

      The October 2007 issue of National Real Estate Investor reported on page 28 that 59% of commercial loans made in the 1st half of 2007 were interest only and all three rating services report that LTV ratios ranged from 105% to 113.4%! This is truly shocking. Almost nothing has been reported about CMBS's (Commercial Mortgage Backed Securities) or CDO's (Collatorized Debt Obligations) and their role in the banking mess. The are worse than junk bonds. REIT pricing multiples are headed down and retail vacancy rates are rising at the same time new space is being developed. Same story with offices, while finance jobs are dying. Does not look good.

      I read of a Federal Circuit Court case recently that concerned the default on $50 ml. private hospital loan. In this case, the LTV ratio was intended to be 80%, but instead they reversed the numbers and called for the value of the property to be 80% of the mortgage! They were supposed to have an independent MAI appraisal, but instead substituted "analysist". The dumb court ruled in favor of the borrower, against a major lender of all things. I have long thought, the bigger the bank, the dumber!
      View article »
Loading...
Symbols:
Authors:
Quick Links:
Contribute an Article Become a Seeking Alpha Contributor

Transcripts

More Transcripts»