AdamB

Things You Would Never Have Said Eight Days Ago

Great comments, dude. Watch for the BKX to rally to its 200DMA at 82 as its level of greatest resistance, and watch for the SPX to rally to its 50DMA at 1310. Fannie and Freddie's inventory of foreclosed properties, mirrored in even greater proportion by U.S. mortgage banks (who have extended delinquency guidelines to reduce quarterly writedowns) is growing by leaps and bounds, and prices paid on sale are dropping precipitously. Remember that REOs and foreclosure sale values do not need to drop very much to wreak havoc on bank and agency capital, as they are leveraged 20-60:1.