sr9web

The Insidious Secondary Effects of TARP Funding

Uh, are we concerned about affects or effects here...

What If the Stress Test is Just the Opening Act

It's outrageous that we bailed out Goldma fat-cats via AIG backdoor. GS is agressively black-box trading the market in big numbers every day. Why should we the taxpayers make it any easier for those rich slobs to fleece us in the market?


On Apr 24 12:33 PM Repsonsible Citizen wrote:

> For me its SIMPLE ,, GOLDMAN got $180 BILLION Tax Dollars through
> the back door of the AIG Bailout . To Pay Off GOLDMAN at 100% on
> their BAD CDS s
> NOBODY ELSE GOT Paid on them most lost 99% . GoldMan OWES the US
> Goverment $180 Billion , Maybe with the NEW TARP FRAUD Investagations
> it will finally be made Public and GOLDMAN will have to PAY Back
> that $180 BILLION !

Easing of Mark-to-Market Rules: Good for Banks, Bad for Investors

"Once the kneejerk short covering finishes, look out below, at least for the banks."

sounds right to me...

On Apr 02 02:59 PM Mad Hedge Fund Trader wrote:

> See? All it takes was a little accounting rule change, and Great
> Depression II will go away. At least that’s what the stock market
> thought today, surging 300 points and blasting through 8,000 in the
> Dow, up 26% from its March 9 low. The only problem with this is that
> it was an absence of market to market rules that allowed Japan to
> lose a decade of economic growth. Investors and auditors will always
> assume the worst about asset valuations, unless proven otherwise.
> That’s what happened in Japan. Once the kneejerk short covering finishes,
> look out below, at least for the banks.

Why I'm Holding On to Citigroup Stock

GE went it went under $6 was a way betterinvestment than C will ever be. At this point C is nothing more than sheer speculation.

25 Companies That Lost America Nearly $1 Trillion

"As far as accuracy of numbers, this is irrelevant"

Buddy, you are an idiot...


On Mar 26 01:43 PM J Clinton Hill wrote:

> Gentle Readers,
>
> The purpose of this post is not to single out any specific companies.
> The original title at my website reads: Incentivized Management for
> Success or Failure: Only in America. SA's editors changed the title
> and as a result probably redirected the focus and intent of my article.
> I would strongly encourage you to check the primary source (hillbent.com)
> regardless of your impressions from reading.
>
> The post was from an email that a CEO friend sent to me and is not
> my own work. As far as accuracy of numbers, this is irrelevant. The
> fact remains is that we know many of the companies on this list have
> lost a LOT OF $$$ thru general incompetence. Period.
>
> Now, let's pretend or hypothetically consider that none of these
> companies were publicly traded on the exchanges and therefore were
> private entities. Let's also pretend that you, i.e. individually
> as the reader, owned these private companies in your portfolio. Given
> that many of these incurred massive writedowns and losses, would
> you as the owner of these businesses be awarding your managers of
> these companies bonuses like this in economic times like this? I'm
> not going to answer this question, but look forward to your responses.
>
>
> In the event that any of you would still consider paying out such
> hefty bonuses, please let me know if you have any positions available.
> I would love to have a job whereby my success or failure is decoupled
> from my incentive compensation.
>
> Sworn to fun and accountable to none... Only in America... God bless
> us all....

R.I.P. P.P.I.P.?

good point!


On Mar 26 10:37 AM toomuchgas wrote:

> Who knows? There is no visibility. Why would anyone bet on financials
> when the oils are so cheap and have clean balance sheets?

Feds Balance Opposing Sides While Large Bank Stocks Fall

It's not the uptick rule that's needed, it's enforcment against naked shorting.


On Mar 22 02:11 PM jasonjim wrote:

> Big time rich shorters are killing the stock market, ruining many
> of the great firms listed thereon, and eventually will destroy America
> unless something is not done soon to curb their greedy appetites.
> Why is the SEC taking so long to reinstate the uptick rule, can't
> they see what is going on, or are they just stupid? I thought I'd
> never say this but it appears that Schapiro is even worse at the
> job than Cox was. At least the latter stopped shorting in financials
> for a time.

Cramer's Mad Money - AIG: Criminal or Stupid? (3/18/09)

None avail to short at Fidelity either - just checked.


On Mar 19 09:11 AM Duke Wong wrote:

> Citi-Group, NO STOCK AVAILABLE FOR SHORT.
>
> Swab, TD-Ameritrade, Scott have no stock for shorting C. My freind
> told me the SEC doesn't allow to short Citi-group.
>
> Is it true?

FASB Unlikely to Suspend Mark to Market

Great article - great comments!

Mark-to-Market Marches Towards Extinction

Your comments are wise. And that's why ordinary rabble won't listen...


On Mar 13 03:22 PM Poor Dude wrote:

> A mortgage is a loan. The home is collateral pledged against that
> loan, and nothing more. Some loans carry 100 percent collateral,
> some carry none, and most carry something in between. Whether the
> value of the collateral goes up or down should have no effect whatsoever
> on the value of a loan made against that collateral.
>
> The value of that loan is the net present value of the stream of
> cash flows it generates in the form of payments made on the loan
> until it is paid off. All that matters is the likelihood of that
> stream of payments happening as planned. For an individual loan,
> that is counterparty risk and should be built into the interest rate
> charged on the loan (higher likelihood of being repaid equals lower
> interest rate, riskier borrower equals higher interest rate, etc.).
>
>
> The underlying value of the real estate is meaningless, except as
> a point-in-time reference used by the lender in deciding how much
> (if any) they should reasonably lend against the home. My guess is
> that reference point probably carries far less weight in the decision-making
> process than the perceived creditworthiness of the borrower. But
> regardless, it becomes totally moot once a decision is made and the
> loan paperwork is signed. The value of the collateral works its way
> into the mortgage process BEFORE the mortgage exists, and is irrelevant
> thereafter (except in the event of default).
>
>
> The value of a bundle of loans is simply the sum of the net present
> values of all the individual loans in the bundle. I don't understand
> using market prices to value long-term assets. It makes no sense
> at all. Markets are frequently far too irrational at any given point
> in time. Sometimes they value things way too highly, and at other
> times they value things way below their intrinsic (or true) value.
> But it's the intrinsic value which matters, and that is what companies
> should use to do their accounting (with full disclosure of their
> assumptions, of course).
>
>
> If I run an ad offering to buy a one-year old Rolls Royce for $1.00,
> and some lady involved in a nasty divorce agrees to sell me one for
> that (so that her soon-to-be ex-husband can't have the car), does
> that suddenly mean that all Rolls Royce's lose 100 percent of their
> value as soon as they're driven off the dealer's lot? And that, in
> the name of fairness, everyone who owns a Rolls must now mark the
> value of their car down to $1.00? That'd be insane, obviously. And
> yet, that's the situation M2M has created with our banks and insurance
> companies (and others).
>
>
> And sadly, there are some people around who are trying to take advantage
> of a temporary market dislocation to transfer the wealth of others
> into their own pockets - no matter who loses how much, no matter
> what institutions get destroyed in the process, and no matter the
> price to our society as a whole. Those are not good people, and we
> should treat them as the thieves they are.

Dividend Yields Continue to Shrink, Don't Yet Indicate a Bottom

Or it means that companies have finally decided that they care more about themselves than their shareholders and yield is now passe.

Five Impossible Thoughts After Breakfast

Oooooh made a million - must be a genius... let's sniff his farts!

The End of the Credit Crisis

The 500k loan is not good because it's too much for the homeowner to pay.


On Feb 27 02:26 PM who wrote:

> I'm no tax expert but a bit lost....
>
> buyers will only pay 100k for bad $500k loan which is worth $300K...
>
>
> but willing to pay $300K for a good $300K loan...
>
> Ignoring tax benefits, why would the buyer not pay $100k for bad
> $500K loan and writedown the $200K. Hence get a good $300k loan for
> $100K and make 200% profit? Why not write down the loan to $200K
> - super save - and make 100% profit?
>
> Isn't this the crux of stumbling block, banks are not willing to
> sell their loans for the fraction of what they paid for it nor reduce
> the principle? The $500K loan has a good part (repayable without
> foreclosure) so why is it worth only $100K unless that is what the
> expected repayment is.
>
>
>

The End of the Credit Crisis

Write downs only are taxable to borrowers on forgiven loans.


On Feb 27 10:17 AM User 365522 wrote:

> The author fails to account for the tax effect on the borrower. The
> $200,000 write down by the bank is considered taxable income to the
> borrower, payable immediately. That will put the borrower into the
> highest tax bracket (which is going up even further). The tax owed
> will be about $80,000. Where does the borrower get that money? The
> bank survives, it stock price soars, while the borrower gets hit
> with a tax bill he can't hope to pay (or discharge through bankruptcy).
> Great plan!

U.S. Debt Watch: Paths to Repudiation

Don't be absurd. Long before USA defaults, whoever is president will declare a national emergency, invoke exectuive various orders and do the following:

1) Declare martial law
2) Fire 50% of all government workers Federal and state (he can do this in a national emegergency)
3) Draft all fit non-working people into a new CCC
4) Use national guard forces to distribute food and essentials.

In fact, firing 50% of all government workers now would solve every budget crisis we face, federal, state and local.