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Wall Street Breakfast: Must-Know News

The prime mortgage problem will be swamped by the commercial mortgage problem which is an order (s?) of magnitude higher and only now beginning to show itself. I don't doubt for a minute that the commercial bank failures will approach those of the '30s on a per capita basis. The total dollar exposure to the commercial mortgage market is considerably greater than the residential market and we are only now seeing the same issues arise.


On Aug 25 07:35 AM markfl wrote:

> "Mortgage lender Taylor, Bean & Whitaker formally filed for bankruptcy
> protection." From all I have read, Taylor's impact on home lending
> (via wholesale market) is potentially rather steep. If we are to
> trust J. Lounsbury's view seekingalpha.com/artic...,
> published today as a follow-up to his very popular banking article
> on SA several days ago seekingalpha.com/artic...,
> Colonial Bank and Taylor Bean may reflect a continuation of banking
> woes.
>
> The prime mortgage problem has eclipsed sub-prime, its not going
> away, and, according to John, bank failures may trump those during
> the Depression if measured on a per capita basis.

Wall Street Breakfast: Must-Know News

auto44 has hit on something that is a major source of the problem - between a mainstream press that either doesn't understand business and finance or doesn't care to report it and an education system that fails to teach basic math and analytic skills, we are left with a population too docile to do anything when the political and financial elite plunder the country the way they have in the last eight years. This is not a partisan rant, both sides are equally at fault - they both rely on the same financial elite to finance their endless campaigns and as a result write legislation with no real enforcement provisions or remove regulatory powers that may have caught some of the more egregious stuff we have seen in the last 12 months.

International Overdiversification

What your analysis and reliance on the international aspects of US multinationals does not do is allow you to choose where your international diversification comes from. If you want to add Japan or Brazil for instance, there is no guarantee that any of your current holdings, whatever they may be, will do that. That is why you can choose dividend paying international stocks to provide sector and country diversification with more targeted results than provided by indistinct data from American multinationals. Use them for what they are: domestic companies operating in dollar economies.

Wall Street Breakfast: Must-Know News

The Senate Republicans decide to get religion just in time to refuse aid to the one industry on which no less than 10% of the American economy depends and for which the money has already been allocated?? This is responsible adult thinking?? There may be a case to be made that one or more of the Big Three should go through Chapter 11 to obtain federal aid but the time for making that case has long since passed. This crisis has gone on too long for late night brinkmanship of the kind practiced by the Republicans last night. It's shameful that the American government is being run by people who refuse to consider the lives of millions of working people trying to make a living just for some abstract principle. We're way beyond that now.

Which Is the Better Investment, Apple or Research In Motion?

Might be a nice idea to consider the impact of ever increasing Mac sales too. The gain in use of OSX and the outside possibility that Apple may finally allow the operating system to be licensed for use on machines made by other companies is a further driver for the stock. In fact, I believe that the sales of Macs is the real untold story of the Apple stock rise - ipods and iphones are the hyoe, Macs sales are the real margin drivers.