apppro

Is Dubai's Default a Black Swan Event?

And as 2nd issue:

To heck with them! Did any of those Arab countries help pay for the reconstuction of Iraq or Brunai when we got rid of Sadam for them!

Is Dubai's Default a Black Swan Event?

This is a just another example of how our collective short term trader/traitor mentality has infected the entire world now. Read the news: <<Fears of a potential sovereign default by Dubai roiled financial markets Thursday, sinking stocks across Asia and Europe and pushing up government bond prices, after Dubai said late Wednesday it would restructure Dubai World and announced a six-month standstill on repayments of the conglomerate's debt. See full story on the impact on financial markets.>>

POTENTIAL - RESTRUCTURE - STANDSTILL not default.

When we shipped all our bad paper over seas we also shipped our bad short term mentality and trading.

SO WHAT if a few rediculous malls in Dubai close up or a few of those ridiculous houses built on phony islands remain empty? That entire area was a waste of Arab oil dollars and should not be allowed to affect everyone else.

Will Obama Replace Geithner with Dimon?

Until you get the shorts who brought this system down out of the market, it won't matter who's in charge of the chicken coop because we're all going to end up in their outhouse anyway.


On Nov 25 11:40 AM Graham and Dodd Investor wrote:

>
> JPM over Goldman Sachs is like saying you'd rather have a wolf guard
> the chicken coop instead of the fox.
>
> On Nov 25 09:57 AM JLK wrote:

Will Obama Replace Geithner with Dimon?

I would be much happier if Dimon would stick to JPM business and get our damn dividend reinstated before he seeks any change of venue. After he does put it back - well good riddens.

U.S. Government Practices Restrict Jobs Growth

Remember my idea above about giving that repaid TARP to the SBA for small business loans? Well, this was out today 11/24 - pretty apropos don't you think?

SBA Runs Through Stimulus Cash
www.thestreet.com/_yah...

Healthcare Reform: Is It Worthwhile? Can We Afford It?

Everyone keeps talking about public options or whatever they feel is the topic of the hour. I'm in favor of anything that will work, but so far NO ONE has stated any plan.
WHAT IS THIS PUBLIC OPTION?
What is the premium?
What does it cover?
What is the deductible?
Are drugs included?
Are there pre-authorizations required?
Etc., etc.

Not one person or politician has given anyone any facts, just a whole lot of superlatives and exaggerations. JUST GIVE US THE DAMN PLAN and Premiums, and then we all will be able to figure out what is good or what is bad.

Right now it seems to me that 90% of the people in favor of redoing the system think they are going to get EVERY medical procedure, EVERY drug, EVERY doctor, and so on... for $150.00 premium per month. Good luck with that one!

Show Me Economic Expansion, Chairman Bernanke

Steve hi,

We never changed so many rules in the middle of the game or in this case IN BETWEEN games before, so I'm not sure how you can expect things to work or revive as before. You're the expert, but from what I have read never did we so abruptly yank out of the World's economy so much liquidity in such a short period of time ONLY because a few didn't think we should be operating that way. At the same time, never did we overly criticize our respective government so much for trying to put it all back in.

Maybe we all need to consider that there are just too many of us here and without all that added liquidity things can't function as they used to and are historically supposed to. We all know how this issue was handled last time we had such a large scale social upheaval due to over population and lack of attainable assets.

I don't think you're suggesting that we need to do that again?

We do have viable alternatives, but many seem intent on not allowing that to happen. Creative destruction does have its' limitations, the biggest one is that something viable MUST be in the plans to replace what is being destroyed! This time we just allowed the destruction for no better reason then covering short postions, and with NO plans for the future in mind or even desired. 'Destruction just for sake of destruction!'
Delporable! Just for deplorable!


On Nov 22 09:07 PM Steven Hansen wrote:

> Joe Shareholder
> i agree that unemployment is not a lagging indicator like many economists
> want you to believe. In fact, a bigger problem is that all the indicators
> we have used for historical metrics all are compromised in one way
> or another.
>
> i laugh when i think back of the punters who argued that this recession
> would be no different than past recessions. our first confirmation
> that things are different this time is that the leading indicators
> are not working as historically advertised.
>
> we almost need to throw out our previous understanding of economic
> dynamics - and pay closer attention to the effects of our actions.
>
>
> ZIRP is condemning us. it is not stimulating the economy and is creating
> enough future obstacles that it frankly is scary.

Show Me Economic Expansion, Chairman Bernanke

Anything that might help boost housing I'm all for, but now it's no longer a matter of interest rates. Now it's all about: JOBS... JOBS... JOBS! Without the security of having one or getting one, the last thing on anyone's mind is buying a home.

AND for those that do have a job and might be considering buying a home - well they're WAITING until they can get it cheaper. We have trained ourselves not to buy anything that is NOT on a major sale and that includes housing. Housing will bottom the second the 1st person decides that he or she can't get the price any cheaper! The argument that housing prices won't bottom until the market stabilizes has turned into a Yogi Bera type quote:
'Housing prices won't bottom until they bottom!'


On Nov 22 02:13 PM Leonard C.Tekaat wrote:

> Why hasn’t the 30yr mortgage interest rate come down further, based
> on the inflation rate, as it has done during other recessions?<br/>
>
> Mortgage Interest Rate At Historical High
>
> If there is one thing a capitalistic economy needs to operate efficiently
> is a means of exchange that is in balance with available supply.
>
>
> The private financial industry has failed to bring mortgage interest
> rates down sufficiently, to help the economy recover from the deepest
> recession our economy has experienced in 70 yrs. With the Fed funds
> rate at near zero, the 30-year fixed rate mortgage rate should be
> much lower. From 1993 to1998, to pick a period that the economy was
> operating fairly well, the 30yr fixed rate mortgage interest rate
> was approximately 100% above the Fed funds rate. The Fed funds rate
> was approximately 3.5% and the mortgage interest rate was approximately
> 6.5%. The inflation rate or Consumer Price Index was approximately
> 3.5%. The fixed rate mortgage interest rate was approximately 300
> basis points above the Fed funds rate. Currently the Fed rate is
> at near zero, the 30 year fixed rate mortgage interest rate should
> be at about 3%, which is 300 basis points above the Fed funds rate
> or 300% above the inflation rate.
>
> The problem with the housing market is that the 30yr fixed rate mortgage
> that is currently being offered to the public has an interest rate
> that is too high to sufficiently increase consumer’s purchasing power.
> Before the current economic crisis occurred the same mortgage interest
> rate was approximately 6.5%. The current interest rate for the same
> mortgage is approximately 5%. The spread between the interest rates
> is not wide enough to warrant the cost of a majority of people with
> mortgages to refinance. If these people refinanced their mortgages
> at 3%, it would lower their monthly mortgage payments, there-by increasing
> their purchasing power. With more purchasing power, the consumer
> would increase demand in the economy, which would stimulate the economy.
> People do not have sufficient purchasing power. This is reflected
> in the fact that unemployment and foreclosures rates continue to
> rise.
>
> With a spread of over 475 basis points between the Fed rate and the
> interest rate of a 30yr fixed rate mortgage, the only entity whose
> financial condition is improving is Wall St. investment brokerages
> and the big banks, which have ties to those brokerages. All money
> is returned to the banking industry after it is introduced into the
> economy. If the money were lent to the people with mortgages, at
> a lower starting interest rate, it would help the banks and the economy.
>
>
> With the economy faltering because of a lack of consumer demand and
> investor and consumer confidence in the future, a stimulus is needed
> to include the consumer in the economic recovery.
>
> To bring down single-family mortgage interest rates the government
> should encourage the creation of a mortgage or create a mortgage
> with a starting interest rate of 3%, to stabilize home prices, increase
> employment, and stimulate the economy with increased demand. A Stimulus
> Mortgage should be created. We need to change the terms of our mortgages
> so Fannie Mae (FNM) and Freddie Mac (FRE) can buy and securitize
> the new mortgages with a lower beginning interest rate. With fewer
> foreclosures the Federal Housing Administration (FHA) would not have
> as many claims and its financial condition would improve. The down
> payment should be at least 5% of the purchase price. The Zero Inflation
> Taxation Policy should also be enacted to help prevent another housing
> bubble. (More on this later)
>
> Lower starting mortgage interest rates would be better for our economy
> than tax credits. Tax credits decrease government revenues, which
> increases the deficit. The government has to borrow more money, which
> has to be paid back either by a tax increase or an inflation tax.
> A smaller federal deficit and an improving economy would calm the
> world’s fears of a weak dollar and another round of inflation and
> higher interest rates. As our economy improves the dollar would strengthen,
> stabilizing commodity prices. The Stimulus Mortgage would create
> more economic activity by a greater number of people than tax credits.
> A tax credit takes purchasing power from one person and subsidizes
> the purchase of the home by another person. The tax credit is unfair
> and decreases the other person’s purchasing power by increasing their
> tax burden.
>
> When the financial crisis occurred in September 2008 the Fed and
> Treasury helped the economy by using the TARP money to stop the financial
> sector from collapsing. The financial service industry is now in
> much better condition. It is Main Street that is now in need of a
> shot in the arm to get well. It can be done without costing the taxpayer
> any money.
>
> Lower starting mortgage interest rates, funded by the Treasury or
> the Fed would not cost the taxpayers anything, because after home
> prices stabilize and the economy improves, the mortgages can be sold
> to private investors. The Fed will do this with all the mortgage-backed
> securities that they have bought in the last year. If the Fed had
> been buying mortgage-backed securities that included the Stimulus
> Mortgage I believe our economy would have improved more than it has
> in the past year. As the economy improves, without inflation, the
> dollar will strengthen, which will help stabilize commodity prices.
>
>
> Banks and financial institutions are not confident with loaning money
> to homeowners to refinance their homes, for new mortgages, or make
> a loan modification, when home prices are decreasing. If a 30 yr.
> adjustable rate mortgage was created with a starting interest rate
> of 3%, this would jolt the economy back to life, the toxic securities
> will become valuable again, as they become performing assets and
> home prices stabilize and then slowly appreciate.
>
> The interest rate on these new mortgages should increase one-quarter
> percent per year and cap out at the currant market rate of 5%. To
> decrease defaults on mortgages, the borrower would have to qualify
> at the 5% interest rate to obtain the loan. These new mortgages should
> not be tied to any index. People do not trust indexed mortgages because
> of our recent history and the uncertainty of the future. We can cap
> the mortgage interest rate at 5% because the Fed will not be the
> only entity that will be controlling inflation and inflation psychology.
> Read Alternative Economic Stimulus Plan and Zero Inflation Taxation
> Policy at economysflaw.wordp.../
>
> We are currently trying to capitalize the banks by infusing money
> directly into them. This policy is wrong because the collateral is
> losing value. As the value of the collateral decreases the banks
> need more capital to stay viable. The value of the collateral must
> be stabilized first, for the banks and investors to be confident
> enough to lend money against it.
>
> What will this stimulus mortgage do for the economy? When the homeowner
> refinances their home from a 6% mortgage interest rate to a 3% interest
> rate their monthly interest payment will decrease by 50%. A $1500.00
> monthly mortgage interest payment will decrease to $750.00. That
> will be like the person receiving a $750.00 stimulus check each month
> for the first year and thereafter a little less each year for the
> next seven years. Multiply this by millions of people and you will
> have a stimulus plan that puts the purchasing power were it should
> be, with the people. The foreclosed property inventory would be quickly
> sold and housing prices would stabilize. Loaning money to banks does
> not create demand in the economy, people do!
>
> If mortgage interest rates were available at a starting rate of 3%
> and the borrower was qualified at a 5% interest rate, the chance
> of a foreclosure would be close to zero. The eight years it would
> take for the interest rate to rise to 5% would allow the economy
> to heal. Business activity would increase; this would increase the
> value of commercial properties reducing the coming crisis in that
> area of the economy. With home values stabilized investors will be
> willing to invest in mortgage backed securities again rather than
> treasuries. With the mortgage interest rate increasing every year,
> the investor will know that their rate of return will increase for
> the next seven years unlike treasuries.
>
> Mortgage interest rates historically have been about 100% above the
> inflation rate for the last 30 yrs. With inflation at 0% and home
> prices deflating, mortgage interest rates for the last year have
> been about 5 to 6% that means they are 500% to 600% above the inflation
> rate!
>
> With the enactment of the Zero Inflation Taxation Policy this policy
> will help control inflation and inflation psychology. This policy
> will maintain the lowest possible interest rate and the chance of
> another housing bubble would be near zero. Low interest rates will
> help maintain the value of the mortgages and mortgage-backed securities.
> Investor will be confident enough to make long-term investments in
> mortgage-backed securities, which will create a market for 30-year
> mortgages. (Go to web site to read about this policy change and its
> benefits.)
> Banks and investors should be encouraged to modify the underwater
> mortgages by changing the tax code so that it would be beneficial
> to them and the borrower when the excess amount of the mortgage is
> reduced.
>
> Until all the underwater home mortgages are modified the economy
> will not fully recover. We need the owners of these homes to be able
> to participate in the economy to increase economic activity. To modify
> their mortgages we should use a modification agreement, not a refinancing
> agreement. For those people who own a home that the mortgage is greater
> than the currant selling price, a clause should be included in the
> modified mortgage agreement that states, the bank will discount the
> mortgage, an amount equal to 20% of the monthly payment, each month,
> for a maximum of ten years, or until the selling price of the house
> plus repairs equals the amount of the mortgage, if the borrower agrees
> to pay off the entire unpaid balance due. This policy would allow
> for an orderly decrease in mortgage balances that are above the selling
> price of the home and more people would elect to stay in their homes
> and pay their mortgages.
>

Show Me Economic Expansion, Chairman Bernanke

How can any of you expect the banks that 'we' have not put out of business lend anything to anyone? What's more, how can any of you still be blaming the banks?

You can try and place the blame somewhere else, BUT banks were forced to stop their lending because everyone kept screaming that the loans and mortgages they already did have were no good,
AND that any loans that they would make will soon go bad anyway,
AND they had to have basically dollar for dollar for every loan in order to remain solvent!

The hypocrisy abounds! We rumorboarded our financial institutions into a state of fear so deep that any move to get out was virtually impossible, and even then it has just been further compounded with Washington intervention. Even when a bank like JPM adds 1500 people to make loans just last 2 weeks ago, they a rewarded by anal_ysts like Meredith Whitless coming out to say that they're still going to go broke and the infamous 'W' is coming anyway. Reminds me of the Mayans and 2012.

Face it, we did this to ourselves and all this negativity and bashing only prolongs and compounds the situation. 'The Shorting of America' has now affected us all, and I for one don't like the feeling. Was it good for you?

On Nov 22 08:39 AM chris coonan wrote:

> We have too many cheerleaders in leadership. Real leaders are needed.
>
>
> Banks need to lend, they are crippling Main Street, and while you
> can understand what is going on, it is somewhat unAmerican for them
> not to contribute to the solution. I am fairly disgusted with the
> banking industry.

A Tale of Two Markets: Overvalued Stocks and the Declining Dollar

What deplorable commentary from many.

Let's all just short everything we can >>
close the borders >>
build bomb shelters >>
and just wait around for the nukes to hit >>
then you can cover those obnoxious short positions.

We could also turn our attention to viewing things on a longer term basis then the length of time it takes for our dinners to come out from the same end that these destruction trader/traitor theories come from.

Yeah I know - not what most of you want to hear, but the truth nonetheless!

Revised Tax Rules:

1. Capital gains under <6 months - 55% tax on capital gains
2. Capital gains 6 > 12 months - 45% tax on capital gains
3. Capital gains 1 > 2 years - 35% tax on capital gains
4. Capital gains 2 > 5 years - 18% tax on capital gains
5. Capital gains 5+ years - 5% tax on capital gain
6. Most critical of all — Institute a capital gains tax of 55% on ALL short sales not directly tied to a long buy by a licensed hedge fund.

MBIA: Tax Arcana

Tom,

Reported what to who? The SEC? That useless regulatory body that actually helped to cause all this mess? Where were those guys when Ackman was going on CNBC screaming about how he was shorting over the monolines because as he put it: "90% of all the subprime mortgages that their CDO's represent are worthless!" That's what destroyed the companies, and our entire financial system too boot. To date less then 10% of ALL mortgages are in actual default, with only I think of about 15% in some state delinquency. Whatever!

Until we answer 2 MAIN questions, nothing can get accomplished because we are still NOT looking at the true cause of our financial meltdown:
1. Who lobbied FASB and then supported the implementation of M2M in Oct. '07?
2. Who lobbied the SEC and then supplied biased studies to support the repeal of the 'UP-TICK Rule' in July '07?

The follow up question should be:
Who then used those 2 things in manipulated ways to destroy the CDO markets and then the underlying securities of firstly the monolines and then the banks?

Our entire financial crisis began here and ended with others naked shorting the banks TO DEATH all because they demanded that 20 years of leverage be withdrawn over 3 weekends. Like the public service commercial:
"CONFIDENCE IS A TERRIBLE THING TO WASTE!"


On Nov 20 10:28 AM Tom Armistead wrote:

> appro, I can appreciate that Ackman's conduct re: MBI and ABK upsets
> you. I reported it to the SEC as I felt that laws had been broken.
> However, I am not holding my breath waiting for them to act.
>
> As an MBI shareholder I look to management to enhance shareholder
> value by any means possible. They have done some things buying back
> their own debt, or bonds they wrapped, as well as repurchasing shares.
>
>
> But the most important thing here is their determination to pursue
> all legal claims against those who have injured MBIA shareholders
> by fraud, negligence, misrepresentation, breach of warranty, violation
> of Securities legislation whether Federal or State, etc.
>
> Obviously I got excited at the idea that they could use a tax refund
> to buy back a bunch of shares and nail the shortseller's naked asses
> to the wall but it is necessary to do some reality testing on ideas
> of that type.

Why Traders Are Abandoning DryShips

What is wrong here and in the market in general - is the short-term option trader/traitor mentality that now exists. Fine, you all want to gamble, go to Vegas; and please don't give me the liquidity bs argument, or that's the market we have so deal with it crapolla.

Fix the mentality and you'll fix this stock among others. Until then, no company can make plans for the future because they (we) all live in fear of somebody's January puts.

Revised Tax Rules:

1. Capital gains under <6 months - 55% tax on capital gains
2. Capital gains 6 > 12 months - 45% tax on capital gains
3. Capital gains 1 > 2 years - 35% tax on capital gains
4. Capital gains 2 > 5 years - 18% tax on capital gains
5. Capital gains 5+ years - 5% tax on capital gains
6. Most critical of all — Institute a capital gains tax of 55% on ALL short sales not directly tied to a long buy by a licensed hedge fund. I'm tired of paying for the pure shorts 3rd vacation home.

MBIA: Tax Arcana

Until you guys attack the cause of MBIA's demise, all this back and forth will remain meaningless. Ackman destroyed this company via his take down of Ambac. He had no idea what long term macro damage he would be causing across our entire society, but what do you expect from scum like that.
You buys keep looking for answers where they don't exist. Monolines will remain dead until the entire Nation says what needs to be said, "Shorts caused this disaster, and we must now go after them as we did out CEO's!"

Sirius Trend: Independent Analyst Opinions Turning Positive

I like that news, but we are now back to the Armageddon 2 pushing by CNBS and a few of their short controlled pundits.

I find it deplorable that every time we try to pick ourselves up out of the much and mire that the shorts forced in to, we get media jerks trying to pull us all right back in.

Congress would better serve all of us if they regulated the shorts and rumor-mongering media rather then the Fed.

Bank Dilution Looms for 2010

Maybe a know-nothing pundit dilution for 2010 would be more appropriate.