prescient11

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108 Comments

    • Tue Sep 16th 15:08 PM | Rating: 0 0
      Commented on:
      Liquidity or Solvency? Sometimes It's Hard to Tell
      This is exactly the question that needs to be asked.
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    • Sun Sep 14th 04:34 AM | Rating: 0 0
      Commented on:
      Lehman is Toxic at Any Price
      Excellent point, these monday morning quarterbacks always chirp up about this time...
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    • Sat Sep 13th 16:47 PM | Rating: 0 0
      Commented on:
      AIG: The Mark-to-Lehman Market
      Where are you at Felix? I suppose an intelligent response to your articles is too much. You were wrong with your exchange with Dear John Thain, and you are wrong now. The idea that this is just an efficient market is a lie perpetrated and repeated by fools.

      Do not be one.
      View article »
    • Sat Sep 13th 13:45 PM | Rating: 0 0
      Commented on:
      Down With Rating Agencies! Plus, Lehman for Laymen
      Ratings agencies should be sued out of existence, how has that not happened?
      View article »
    • Sat Sep 13th 13:19 PM | Rating: 0 0
      Commented on:
      AIG: The Mark-to-Lehman Market
      There is an interesting article about CDS speculators essentially engaging in aggressive naked short selling TO FORCE THE DEFAULT of companies by driving their share price to the ground. Thus, they cannot raise capital because of this ridiculous low share price and most do not want to purchase the company because the shares don't stop dropping.

      Now, we can argue about the merits of whether they should have raised capital when their share price was higher, but that really puts the cart before the horse, doesn't it. In other words, I find it ridiculous that if LEH has adequate capital levels, that it should be forced to dilute shareholders at $20/share to raise ADDITIONAL capital so that the "market" will feel comfortable with its business. You do see the vicious cycle that is happening here, don't you.

      Banking is about trust. Assume LEH has adequate capital at $20/share, thus no need to dilute shareholders at this price or raise additional capital. Then, "rumors" about LEH's assets and losses start to percolate on the street. Hedgies with enormous assets and the ability to leverage ridiculous pressure, drive the share price down, scaring all of the investors and LEH's customers/counterparti... that perhaps LEH isn't stable. Thus, funds are removed from LEH even though they had sufficient capital, and now LEH's share price is at such a ridiculously low level and unstable that no one wants to invest. Thus, their capital continues to bleed as a result of this, and problems occur. How about that Felix, why don't any of you uber-bears ever address that frigging point.

      It's so frigging obvious it's ridiculous. Look at the action in the bonds and the CDSs, to the extent one can. After BSC no fool is going to be as transparent as buying crazy out of the money put options. But I bet the real play is in the bond and CDS market. If one restored the uptick rule and banned naked shorting out right FOR ALL COMPANIES then this would cease. Cramer is absolutely right here.

      And where is the damn SEC, the damn OTS, the damn Fed, the damn Treasury, our FRIGGING OFFICIALS PAID TO STOP THIS. They fiddle while Rome burns and these companies' debts are forced upon the taxpayer. My own conspiracy theory is that they want this forced consolidation of financial companies. For what purpose, who knows. But I find the fact that nothing is done about these obvious manipulations to be absurd. Naked shorting is already illegal, why has it not been stopped?

      Of course, LEH must bear a bit of the blame. In this environment, diluting shareholders at $20 is much better than a forced sale at $2, given that what happens above is obvious and will continue to happen until "the Street manipulators" are satisfied. Until then, the carnage will continue. But the wealth destruction we are witnessing, and subsequent taxpayer burdens, without any intervention by regulators, is ridiculous.

      As goes the famous saying, "when they came for me, there was no one left to stand to object..." True words indeed.
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    • Fri Sep 12th 12:37 PM | Rating: 0 0
      Commented on:
      Debating the Lehman Collapse
      Both are right. Dear John Thain is more right, much more so. The damn SEC sits on its hands and does NOTHING while short sellers and hedge funds ILLEGALLY naked short sell LEH to death which CAUSES counterparties to lose confidence and this leads to the spiral we are witnessing. Plain and simple.

      However, LEH should know better and have become much more transparent about its situation, and they should have done so 2Q. Which is why MER might be a good bet to pick up on these drives down - I haven't studied it but at least they appear to try and deal with these issues.

      At the heart of this though, DEAR JOHN THAIN is exactly right. And further, this whole mark to market fiasco needs to stop. If your neighbor's house goes into foreclosure and sells for $10,000, does that mean your previously $300,000 house is worth $10,000.

      But we have leaderless government that does nothing proactive other than goofy "bailouts" rather than getting to the heart of the matter. Ever wonder why? They want consolidation, they want more control over the matters, and if bankers weren't so damn stupid, now they're going to have Uncle Sam in their business for years to come.

      Short selling abuses - illegal naked shorting - was supposed to be stopped in July. It is now September and it is occurring by every sheeple hedge fund with an "idea" to throw around.
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    • Fri Sep 12th 08:01 AM | Rating: 0 0
      Commented on:
      Lehman Won't Be the Last Major Bank Failure
      A few major banks may "fail", but you're wrong on the CDS deal, that will be taken care of. Same way FDIC will not accept a WM failure. Imho.
      View article »
    • Thu Sep 11th 18:03 PM | Rating: 0 0
      Commented on:
      Could Lehman's Failure Cause a Systemic Meltdown?
      The answer, obviously, is yes. Does no one read? JPM looked at what would happen if BSC was just allowed to fail and it concluded, with I think a 90% certainty, that the major IBs would ALL FAIL, including GS.

      Think about that for a second, the exposures are so great that it would bring down GS.

      If you think the government is going to allow that to happen, think again. However, equity holders will likely be wiped out since the Fed./Treasury is rumored to be involved. Sad case.
      View article »
    • Wed Sep 10th 13:40 PM | Rating: 0 0
      Commented on:
      Time To Bail Out WaMu?
      Damn, someone beat me to it.
      View article »
    • Sun Sep 7th 23:02 PM | Rating: 0 0
      Commented on:
      Paulson Rolls The Dice At Taxpayer Expense
      inthemoney:

      great comment.
      View article »
    • Sun Sep 7th 17:08 PM | Rating: 0 0
      Commented on:
      Paulson Rolls The Dice At Taxpayer Expense
      Somebuddy's upset.

      You know this is a good deal for the markets when this clown is upset about it.
      View article »
    • Sun Sep 7th 16:59 PM | Rating: 0 0
      Commented on:
      GSEs Into Conservatorship: Can Housing Stabilize Now?
      "Just because it's government backed doesn't make it good and taking on this much debt doesn't make the treasury's sheets any better either."

      What a stupid comment. Government backed is risk-free. You'll see mortgage rates drop now. Watch it happen. Paulson may be a lot of things but he's no dummy and this is all planned.
      View article »
    • Sun Sep 7th 11:21 AM | Rating: 0 0
      Commented on:
      Fannie & Freddie - and Others - Overstate Their Capital Base
      I saw your comment about the mall from the Blues Brothers in Harvey, Illinois. Right outside of Chicago. Too funny how far you will go to make your bearish comparisons. "Of course" there was a disclaimer, but it simply points you out for what you really are - uber-bearish without an open mind as to what will happen. Sorry, but I gotta follow Cramer on this one. All that's needed is time, and they can delay this for long enough for most to make it out just fine. Perhaps you should revisit some of your analyses.
      View article »
    • Sun Sep 7th 09:58 AM | Rating: 0 0
      Commented on:
      Problematic GSE Bailout
      Gross and Greenspan talk their book and make a ton of money. The game continues. I agree, debt holders should f'ing suffer too, they were just as bad as this author points out.

      Excellent point.
      View article »
    • Sun Aug 31st 18:09 PM | Rating: 0 0
      Commented on:
      Lehman Follows Good Bank/Bad Bank to Redemption
      Roger,

      How exactly would the mechanisms of this take place though? Obviously this is a model that many may follow, but what would the likely effect on the stock price be, there has to be some pain for dealing with all this garbage either when selling it or spinning it off?

      thanks
      View article »
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