bobtailnag

The Weekend American Capitalism Died

You wonder why Bolshevism held sway for over 70 years in the midst of mind boggling oppression? The people didn't really know what was happening.
Between 1946 - 1976 Mao allowed almost 40million to die of starvation and lead poisioning and today Shanghai Sally is dancing in the street celebrating Chinese government - they don't really know what is happening.
The Jeffersonian Declaration of Independence and Madison Constitution is completely unknown by 90% of the homeowners who just inherited the Government as their mortgage banker. They think it's a good thing. Tell me again why advocation of state soverignity over centralized authority is a bad thing.

Unintended Consequences of the Fannie / Freddie Bailout

Jim Rogers get's it. When in one day a government takes over control of 50% of the people's homes ( "We veel make them pay and pay on time - Vee promised the Chinese) it is necessary to next take control of the Insurance portfolios guaranteeing the lives and property (We veel make you pay ze premiums and it ees gut that some die early to help zee faderland) and of course there is the public school system, gas and oil and auto industry (Vee must have safe, cheap transportation like zee Volksbug).

Will the Stock Market Continue Its Upward Trend?

When the government owns your mortgage, one does what the government says - especially when the government is a GS-13 bureaucrat who thinks too many loans have been made in Denver so let's tighten up there and put out some cheap loans in Albany and get some more going in Valdosta. Yeah- plan it. That's what they call it in China.

FDIC Bank Foreclosure Streak: Batting .667 on Fridays

Uh, uh, totally disagree - Henderson is definitely the last one on the list. Definitely. Definitely.

Get Ready to Short Homebuilders

Inside the beltway Washington DC
Declared "recession proof" in 73
Dclared "job loss proof" in 81
Declared "resale loss proof" in 92

For the first time Inside the beltway resales across the value spectrum from $500k - $2m are now "not proof". In 06 the beltway realtors, Long and Foster and Weichart were stunned, In 07 they were in denial, in Spring 08 for the first time sellers are told "cut the price or keep the house- and pray, pray, pray". The buyers have vanished.

ABX Bonds: Longer in Duration, Lower in Priority

Mr. Maxfield,
Is it possible that ABX is a proxy for much of the Global Valuation downgrades on subprime debt? If so does this mean that the writedowns to date and the near term future ones are being overdone by a wide margin? Wouldn't this result in overstated paper losses to many of the financial entities? Losses that may in fact one day reappear as gains if held by the writedown owner or as market appreciation if the securities are traded over time.
Thank you again for such a clear explanation.

ABX Index: Some AAA Subprime Mortgage Bonds are Less Equal than Others

Thank you for explaining this complex instrument in terms even I could grasp. I understand the risk pricing effect of having the long term AAA's, which obviously have the greater risk, impacting the ABX now vs. what I had previously thought was a mirror image of Freddie's position. What I did not quite understands was "Accordingly, the AAA bonds can handle roughly 60% defaults at a 50% severity" -- does this mean Freddies AAA's can withstand this impact and what does 60% at 50% severity translate into in term of a discounted or potential loss?