Fitz919

The Truth About Goldman and AIG Becomes Clearer

There is plenty of room for the banksters in Guantanimo.

The BofA / Merrill Mess - A Misguided Mob Goes After the Wrong Guy

Lets get right to the point, Lewis was forced to take TARP in exactly the same way he was forced to take Merrill. Bernanke lied, and so will Hank...end of story.

Why This Rally Is Unsustainable

I'm glad to see someone pointing out the obvious. I would like to take one point further though. The public/private partnership plan to buy up toxic assets is now DOA. You see the relaxation of mark to market rules have made it possible for banks to value those assets as high as they like. Now they have no reason to sell any of it. It produces income for them, and now it lets them inflate their books. They show up as paper gains, which of course they claim as profits. The formerly toxic assets are now the geese laying golden eggs...there is no way they are going to sell any of it.

Are the Banks Telling Us the Truth?

Cooking the books is standard operating procedure for many financial institutions. They employ a huge bag of tricks. The 500 Trillion derivatives market is off balance sheet for example. Hard to value Mortgage Backed Securities "Toxic Assets" can now be valued as high as they want them to be under the relaxed mark to market rules. Now there is the goose that layed the golden egg as far as financial institutions are concerned. And there is no way they are going to sell their geese to the public/private partnerships. This means Geithner's big plan is DOA. Turning insolvency into a mere liquidity issue for the purpose of getting TARP money was child's play for these guys. Look at how far IndyMac Bank got with 10.5% of their loans not performing, and the FDIC didn't have a clue until there was a run on the bank. They hid their bad loans so that the regulator wouldn't see them on their books.

When Wells Fargo reported a $3 Billion profit, I immediately figured it was due to the relaxed mark to market rules. And the other big banks that reported profits in January and February, did so only after they had assurances that the mark to market rules would in fact be relaxed.

Bail Out for Dummies - Part I

You missed the point on 2 critical matters. Mark to Market has been relaxed, allowing banks to value toxic assets any way they like. Every bank will now value these assets much higher. In fact they will value them so highly that Geithner's Public/Private Partnership will never function because the banks will not sell. There is no way to sweeten the deal enough to get them to sell. Geithner's plan is DOA before it even gets organized, and Geithner knows it. He's been blowing smoke, and adjusting his mirrors in an effort to trick the market into thinking he's doing something that's fixing the financial system. Geithner has tried to convince all of us that his smoke and mirrors programs are reality. It's a scam!

10 Reasons Why We Still Haven't Hit Bottom

The bottom will be well below Dow 6,000. It could be this year or next year. The pain is only beginning. We will soon have too many homeless to count. The downward spiral is articulated perfectly.

The homes being bought right now, are being bought at auctions.

Banks will not sell toxic assets because in two weeks M2M will be gone. They'll value them any way they like going forward, but they still won't lend.

Obama's plan to help 9 million homeowners with their mortgages will fail because the new mortgages will reset their interest rates in 5 years. It's the worst plan ever because it works just like Sub-Prime, Alt A, and Option Arms. We needed fixed rate mortgages at 4%, and instead we got the same scam that got us here.

Toxic Assets: Facts, Lies and Hype

The report about Citi being profitable during Jan and Feb was from an office memo. It was probably an answer to a question about how well they would have done if they didn't have to comply with mark to market accounting rules. It wouldn't surprise me a bit if this quarter they had another big fat loss under m2m.

Just watch...when earnings season comes around again, the market will be heading lower.


On Mar 13 12:43 PM Plumber 250 wrote:

> I don't know about google hits because I am basically electronicly
> challenged. But I do know that just because sentiment changes doesn't
> mean reality changes. A week ago these banks (Wells Fargo, Citi,
> BofA, etc) were totally in the crapper and this week they are soaring.
> This looks like a bear trap to me. Galbreath's book about the crash
> has numerous accounts of Wall Street leaders issuing statements about
> how the carnage was over and everyone could jump back in. That's
> all baloney. The tsunami of credit card defaults and student loan
> defaults is going to drive the banks further down and anyone that
> thinks otherwise should come see me about a bridge I have for sale
> in Brooklyn. What else is Buffet and Dimon going to say....oh! by
> the way our banks are technically insolvent and we are going to have
> to have a new round of capital raising at fire sale prices. Come
> on people, one Bernie Madoff may be on his way to jail, but there
> are still many others out there. Anyone who even thinks of buying
> bank stocks at this time needs to be fitted for a sleeveless white
> jacket. There is an old saying in retail....the butcher that has
> no lamb chops can afford to advertise them at the lowest price in
> town. What does it matter what the spread is on bank loans if people
> cannot afford, or are afraid to, make purchases of the products the
> money would be loaned for? In one breath the wizard of Omaha is saying
> he has never seen the consumer's wallet sewn so tightly shut and
> in the next breath he is telling us the banks are making loans at
> record spreads. Cars aren't selling, RVs aren't selling, the universities
> are scalling back because student loans have plummeted. Six months
> ago we were hearing how corporate balance sheets are bloated with
> debt, all of a sudden they all got well. What happened? Did they
> all hit the lottery? We have a debt problem in this country. Families
> and corporations are leveraged to the hilt. Consumers cannot spend
> their way out of that problem and corporations cannot borrow their
> way out of their problem. As long as the housing market remains a
> zombie the banks have junk for assets. When the million plus empty
> houses that are on the market are sold to families who can afford
> them, and when the houses that should be foreclosed on are foreclosed
> on and subsequently sold to families who can afford them (and that
> means having a job) then the banks will be out of the woods. Until
> that time, watch out for the bear traps.

AIG Bailout Empowers Class Action Lawsuit Against MBIA

Interesting comment. It sounds like you figure that JPM bought a derivatives contract that pays off if several companies go bankrupt, and then they shorted those companies to help it along. Is that the gist?


On Mar 12 05:35 PM mbi4ever wrote:

> Michael;
>
> You are completely correct.
> The market powers (JPM, GS, BAC....) want MBIA and Ambac gone. That
> would trigger CDS contacts and make LOCs as the only insurance vehicle.....
>
>
> There is a story out there thath JPM needs 9 (or something like that)
> BKs to take place among monolines, car manufs., major insurances
> etc. in order to trigger a major derivative contact that would deplete
> the "whole" market out of capital AND in JPMs advantage, of course.
>
>
> There is a huge conspiracy WAR going on......

Three Possible Scenarios for the U.S. Economy

I'm curious...is it still an ARM, or were you able to get it 4.125% fixed? And...were you underwater? And...are you now underwater? I'd sure like to hear a little more about this.


On Mar 12 08:50 AM hazenyc wrote:

> just a quick reply to:
>
> "#1. Alt A, and Option Arm loans will reset in a huge wave over the
> next 2 years. This may double the Toxic Asset load, because too many
> loans are already underwater, and people will have to walk"
>
> I had a 5-1 ARM just reset at 4.125% .. i don't see where the damage
> is?

Three Possible Scenarios for the U.S. Economy

It wasn't that long ago that everyone but Bernanke was using the "R" word. I'll give you two good reasons for getting used to saying the "D" word.

#1. Alt A, and Option Arm loans will reset in a huge wave over the next 2 years. This may double the Toxic Asset load, because too many loans are already underwater, and people will have to walk.

#2. Obama's Mortgage Rescue Plan that is supposed to help 9 million homeowners is a scam. His plan has all these new mortgages resetting their interest rates in 5 years. It's the same as Sub-Prime, Alt A, and Option Arms, and is guaranteed to fail. It's the worst plan ever!

Toxic Assets: Facts, Lies and Hype

Don't waste our time with your google hit nonsense.

The Bane of Broken Balance Sheets

Would we even be having this discussion...or this financial crisis, if there was no such thing as an Adjustable Rate Mortgage?

If everyone, and I mean everyone, were able to rework, or refinance their mortgage to 4% fixed, we would have our stable economy back.

Obama's new mortgage rescue plan has all the new mortgages resetting in 5 years. This proves that Obama's team does not want our financial system to recover...they are planning to take it over...and they've almost got it.

AIG and Our Core Economic Issue: Unknown Asset Values

The Value of Mortgage Backed Securities changes every day. The Nightly Business Report did a 3.5 minute piece on this very sebject on Feb 13, 2009. They used one of these actual securities and dug into how it works.
Their one example...one security... represented more than 6,000 sub-prime mortgages. With mortgages going into default (no payments coming in), others getting refinanced and are falling out of the security (no payments coming in permanently, that portion now has a value of zero) etc., the value changes constantly. We are moving into a period of very heavy activity, when Alt A and Option Arms will begin reseting. This is the second wave of the Morgage Backed Tsunami...it's very big...and it won't be stopped. There are already 180 Billion fingers stuck in the AIG dike, and a Tsunami is coming. What do you think is going to happen?

Can the Public-Private Plan Work?

The money is being printed in Switzerland because we can't print it fast enough in the U.S. I learned about this about 2 months ago.


On Feb 18 02:07 PM Bababooie wrote:

> So... If the Common banks don't have it .... The Investment banks
> Don't have it..........The taxpayers are losing their homes, because
> they don't have it..... exactly where is the money???

Can the Public-Private Plan Work?

Selling the toxic assets, and allowing them to live on in someone else's portfolio is idiotic. The holders of the underlying bonds must be cashed out, the toxic paper shredded, and the credit default swaps which insure them voided. And the designers and sellers of these toxic assets incarcerated for securities fraud.