phlash79

Financials Likely in Dead Cat Bounce, But Fed's Now a Wildcard

I have researched the RBMS and CBMS monthly default rates...looked at how they put together CDO's ...learned a new word...Tranches...and in all of these presentation and articles not one person mentioned that real estate --in my mind a renewable resource...should be devalued to pennies on the dollar...the property remains...someone will eventually purchase it...albeit at a discount to the loan value but still the asset or liability depending on how you looked it is still physically present...why not reconsider this write down mess based on real market values despite depressed prices and then realize that eventually the asset will move from depreciating to appreciating...

Can you explain why the drastic writedowns? If not please let me know where I can purchase some of this real estate for .05 per dollar of value...regardless of the inflated price...lol

3 Reasons To Be Bullish on the Investment Banks

I agree the investment houses maybe an investment someday...but just in the last few days...S&P downgraded both GS and LEH...The monthly default rates of RBMS' (Residential Backed Mortgage Securities) is accelerating with huge increases in subprime loans not even close to reset dating back only to AUG 07...we haven't even started seeing many of the 2006 resets of 2/28 loans...the lending criteria was so loose that 2006 defaults will far surpass 2005's...and even the first half of 2007 2/28 resets are still 18 months away...CBMS (commerical backed mortgage securities) are seeing increased defaults...I wonder why when you have empty buildings because the economy is in a downturn...ALT A and even Prime borrowers are defaulting at higher rates...

Why would you invest in a sector that may be rallying on short covering? Or why would you invest to find a bottom when we are at least a year away from any type of recovery...CIT is failing as we speak...BSC's purchase will be mired in lawsuits for the foreseeable future...Earnings on banks will be lower for at least the next year...what is positive about this? or is it wishful thinking...I would imagine had Apple turned in a 42% loss and said it's earnings would be down 50% for the rest of the year...it wouldn't go up $20 rather it would tank to almost worthless...I think that the S&P is so heavily waited in financials that we see self-fulfilling prophecy in action...too many are wishing it would go up and others are artificially pushing it up...the deleveraging in commodities maybe the best sign we have of a move to bolster balance sheets...

But most of all I think the headline was misleading and could create misconception...yes when we are at a true bottom then bottom fishing will take guts...re run this article then...lol