Warm_Paw

Goldman, CIT and the Modest Return of Capitalism

It's ugly.
Maybe Obama didn't know Paulson was setting him up handing him this tarp idea. He just hit the scene and was relying on the existing financial gurus.
The big question is, how much toxic asset does Goldman still hold and have they honestly marked it to market?
Could be a farce to get sideline money poring in so these banks can really unwind.
Credit Suisse selling some mortgage securities is the beginning of the sales pitch.
I know I wouldn't touch them with a ten foot pole.
Like buying Bre X!

When Goldman Wins, You Lose

I supported Obama in the beginning, but he's wandered off and taken up the cry of healthcare to lower govt spending, when he could cut off this bank funding and lower govt spending.
The financial crisis is not over yet.
If Wall St. is more powerful than the president of the USA - it's time for a vote of no confidence.

Surprise, Surprise, Surprise: Positive Economic News Everywhere

Hey - he's called "THE GOOD NEWS ECONOMIST"
He reports good news.
Give 'em a break.

The bad news economist is reporting reality.
"2-4-6-8!"
"BOY DID WE DEPRECIATE!"

Counterparty Risk Subsides: Is the Worst Over for Financials?

Notice on the chart how overall baseline risk continues to increase upward to 2009.
Notice how the more serious risk spikes while CDS' come due.
This chart says things are getting worse and that no one knows what the next spike will bring.
We have to ride it out until the next bundle of CDS' come due to find out how much of the next wave of maturities are toxic, worthless and AIG must then reimburse a bank with money it doesn't have.
AIG reports in August, they may not even be around for the next spike. That would put the toxic assets solely on the banks.
Goldman will have paid itself handsomely just in time to get egg on their face. We're only half way, we're not out of the woods yet.
Probably why Goldman's in a hurry for their bonus!

Bank Earnings: Revenues Falling, Losses Rising

Great Article!
Hits the nail right on the head!
Volumes aren't very high in trading at present so I think many are thinking the same way. Waiting for other shoe to drop. Probably October. 1 trillion of toxic asset probably turned over with another trillion left to be realized. That's roughly my opinion.
I've been watching CNBC and anyone who discusses these obvious facts is brow beaten and treated like a spoil sport, while manic hosts babble on in an anxious fashion.
The bottom line for dragging the country out of recession (depression) is jobs. If labor is being offshored, who in the US can afford to live on credit (home equity loans) any longer? As long as products are purchased from countries with $1 an hour labor, how does the US compete at home by manufacturing the same product? Last but not least, how do $1 an hour workers purchase North American big ticket items? Something has to give.

High Frequency Trading: Goldman's $4 Billion Wildcard

These traders do themselves harm.
Investors, weary of losing money, are on the sidelines.
Soon it will only be the HFT's manipulating each other.
Capital markets are for business to draw money from for their businesses. Wall St. has become Vegas.
Time to put my money to work in my own business. Purchasing stock is a farce . Even the banks aren't safe. At this point in time Gold ventures are safer than banks.
This isn't going to end well.
America doesn't produce anything anymore. Just a middle man.

This Advance Will Be Measured in Days, Not Months

My RIMM prediction was posted here on July 10 2009.
The article was :RIMM Proceed with caution.
It's July 17 and a miracle has occurred. RImm's gained $7 a share.
Was it the settlement of a court case where RIMM has agreed to pay $264 million? I could see how that would help share price...
What settlement, when you pay out $264 million, you didn't have a defense.

This Advance Will Be Measured in Days, Not Months

I agree with shorting from here on in.
I'd go as far as saying we're about to see March's lows after AIG reports in August. They should've blipped off the radar after losing what I believe was $700 + dollars a share.
I'd like to know if any of these banks have turned over any of their toxic assets and how long they are allowed to suspend marking them to market???
Phillip Davis had it right in his article "Here we go Again"
10 days ago RIMM was paying a premium of $7 a put at $65 for this strike date. Everyone claimed this was Bearish.
I knew it was bullish for whoever sold the put.
I also knew RIMM would be about $72 today for those puts to expire worthless.
We wonder how Goldman makes 10 billion in trading and 4 billion in actual banking? They have some very accurate traders at a time when markets are a roller coaster ride.
One can only wonder how events seem so well choreographed.

Did We Nationalize Banks, Or Did They Nationalize Us?

Paulson was pooping his pants in his congressional testimoney yesterday.
He couldn't look any guiltier.
My humble opinion is that he moved to save Goldman's butt before he passed on his position.
That's why the haste.
The GOP basically scrambled to inject AIG with enough money to save Goldman, initiating the plan to then hand it to Obama.
The GOP put us in this position, even Greenspan acknowledges that trying to regulate the mortgage industry would never have got past congress at that time.
A very thorough investigation of Hank Paulson should ensue.
It's a conflict of interest that he's an ex Goldman employee.
When AIG was infused with Capital, who was the chief beneficiary?
The tax payer should have been given a referendum.
What Obama is now going to have to deal with is that the same ol' boys network on Wall Street is now going to cause another financial crisis only this time, on his watch.
The destruction of these banks would have cleansed the country.
As for Nationalization, it's a non event.
The govt doesn't want to own the banks and the banks are repaying as soon as they can.
The powers that be understand the tax payer's dollars should never have been used in this way. These banks should have failed if they were destined to fail and from the rubble come new banks. Better banks.
There is no proof the transition from such an occurrence would have sent the US into depression.
The shift would have rewarded banks that avoided the sub prime mess, instead of banks with the most political cronyism.

$10 Trillion in Wall Street Aid and No Investigations?

This is exactly how the sub prime mess should be viewed.
It's almost two years of financial collapse and no one's written such an article.
Geithner deludes himself thinking sideline money is just going to come poring in. People have turned their backs on Wall Street.
Better odds in Vegas. More honest people too!

Citi: Facing Bearish Trades

It's not bearish, it's bullish.
Citi should be underwater but govt has changed accounting rules so it will come through unscathed.
Geitner cheerleading a rally until banks healthy enough to mark to market toxic assets.
So, with that being said, citi doesn't fall apart and your trader pockets $7.40 a share of the premium on the puts while paying .1 cent a share on his calls.
So the calls expire worthless?
What's $70, after making $49,000 in premiums.
I think the traders are going to make a buck on the positive note this week, just in time for it to get ugly in August when AIG falls apart.
Notice AIG went up a buck and change today?
Obviously speculation after pundits claiming no intrinsic value left.
It's the inside traders twisting the market out of context that has conservative money sticking to the sidelines.
I'd like to get a hold of the Goldman trading program and see what their game plan was to be for this strike date.
RIMM just falls to $64 for no apparent reason while it's one of the few companies actually making money. This roller coaster ride is a circus.
I'm buying real estate with my money - trading days are over until there is some form of normalcy on Wall St. Just crooks and low lifes.

RIM: Proceed with Caution

I'd like to know what Goldman Sach's program trading holds in store for RIMM. I wouldn't be surprised to see them write a massive amount of puts on RIMM, which is actually bullish for RIMM.
Once the puts are written at this lower share price, RIMM's share price takes off and the underwriter keeps all the put premiums.
It's all about the banks and AIG.
If the banks continue to shelve marking to market the toxic assets, they will look profitable. If they attempt to deal with these assets, they aren't going to look so profitable. Which means the pain will be held off for another quarter.
The banks are allowed to claim losses as gains in some weird twist of accounting but are hesitant to do so because they then are stuck paying taxes on money they didn't earn.
The whole mess is an absurdity.
So if this quarter isn't dealing with the real underlying problem, RIMM will skyrocket. If banks tank - the whole market will take a hit.
RIMM itself as a company is chugging along as usual. Competitors aren't slowing their growth. The smart phone market is in it's infancy and is growing overall. Even Eric Schmidt uses a Blackberry. So for this quarter, you pays your money, you takes your chances. Nobody knows. Now if we could get that russian guy with Goldman's programmed trading, we could see what they had in store for RIMM.

Oh, So Now There Are No Green Shoots?

I agree on the "manic tone" view.
CNBC would brow beat anyone who suggested the situation wasn't rosy. They'd cut them off and not allow them to finish their take on the economy if the news team didn't hear what it wanted to hear.
Then they'd use buzzers to insure everyone made their point in under ten seconds.
You couldn't watch the show if you had anxiety issues.
Put epilectics into a coma. :-)
The reason I'd watch, the nay sayers would point out where weakness lies. Whenever Larry Kudlow cut them off I know it was a good place to initiate a little research.
Quite a few nay sayers with good arguments.
For all this little green shoots talk - the show refuses to discuss how much toxic asset is still on bank balance sheets and how plans to remove these toxic assets are going. Better yet, no one seems to know until they come due, how bad the toxic assets get.
We may not be able to afford the stimulus needed to help the banks. Their fall may be inevitable.
The accounting rule changes from mark to market to some new form where losses get to be reported as gains are going to really bite the ignorant investor on the behind.
The banks don't want to use these changes because declaring a loss, a gain means they have to pay taxes on money that's not their or that wasn't income.
As for transparency, FASB rule changes like this haven't been posted across the front page.
Some other network should bring on the same kind of show only to bring business pundits on to tell the truth. Examine all sides of an issue. As lousy as CNBC is it's the only exposure to news and all pundits are thought provoking.

On the Idiocy of Financial Journalism

Smarmy articles are written by people who do too little research and too much procrastination.
Speaking of which, the word extrapolation should have nothing to do with investing. I'm hearing that word alot lately.
If the chicken hadn't stopped to sh!t, it would have made it to the other side of the road.
Oil's being affected by interest rates and the value of the greenback, and is still infinite at this point in time. We'll have baked the earth to pure carbon by the time we run out of oil.
Goldman Sachs is purported to have an oil speculation division, I'd bet that had something to do with $140 oil.
Capitalism, like communism, might work, if it weren't for human behavior.

Modeling Bank of America's Share Price

WTF?
Even after extrapolating, using intuition and trial and error, the reader hasn't a clue what this article just said.
Hey Ivan, spell it out for me.
Say what you mean and mean what you say.