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  • Beware the Bull Trap, All Is Not Right with the Markets Just Yet  [View article]
    "Remember that we're not even half way through this credit crisis and there's still a lot more pain to come in residential and commercial mortgage-backed securities and in the consumer credit space.."

    how much more pain and why? i am a bit tired of all these alarmists out there without a clue, or at least an explanation... would you mind explaining your reasoning?

    here is mine. The toxic 06 book has already developed and we will start seeing decline in defaults there soon. It already probably started. Usually defaults in prime peak around year 3, lower quality- much earlier... Obama plan will work.

    07 is still developing and will level of next year (again, Obama plan might fix it much sooner)... thats for prime... subprime has leveled off, near prime is almost there... sometime in the next couple of quarters 06 downward and 07 upward trends will start counterbalancing each other... thus the peak in Q3... I personally believe it will start happening now, with, you guessed it, help from Obama plan...

    So are we still only mid-way through crisis yet? Other shoes to drop? CRE is 25% of resi, CC is same as CRE (roughly). Both already developing. Throw in $3.5 trillion from govt about to start flooding the street. By the looks of it, we are almost done with credit crisis.

    Mar 19, 2009. 02:57 AM | 3 Likes Like |Link to Comment
  • Fed Tries Its Own Version of 'Shock and Awe'  [View article]
    "These actions imply the Fed is more worried about the state of the economy than all the recent "happy talk" would suggest. Otherwise, why come out with three major announcements totaling over a trillion dollars plus the expansion of the TALF which has not even gotten off the ground yet?"

    They have talked about ALL-IN, SHOCK-AND-AWE action for many months already. About time they have delivered. Banking resolution is next. Then we see the effects.

    Does anybody care to look at numbers really and do comparative analysis? All I see is these "concerned" people, who doubt every move made by somebody who is actually trying to do something. Why not come up with a solution?

    Here are the numbers: They estimate that the total bank losses will be in the ballpark of $3.5 trillion. The govt have already printed/promised to print/borrowed somewhere in this n'hood. You dont think it will help?
    Mar 18, 2009. 11:54 PM | 1 Like Like |Link to Comment
  • Housing Data Lifts the Markets  [View article]
    Did NYT account for the cheapest money EVER as a source to buy homes? ALso, as an analyst for almost 15 years, I know a thing or two about the 120 YEARS of historic data they bring up. Most certainly, its total garbage.

    On Mar 18 08:58 PM The Mad Hedge Fund Trader wrote:

    > Look at the long term trends. I am more convinced than ever that
    > real estate has another 25% to fall, and best case, it is dead money
    > for another five to ten years. The New York Times produced some insightful
    > data on inflation adjusted home prices for the last 120 years, which
    > baselines at a $100,000 for a single family home in 1890. Few people
    > realize how superheated the recent real estate bubble really got.
    > Past bubbles very consistently peaked at $125,000 in 1896, 1979,
    > and 1989. This last one peaked at $205,000 in 2005, almost double
    > the previous record highs. And while we have dropped 34% since then,
    > to $135,000, we haven’t even fallen to the past all time highs yet.
    > If you look at historical lows, my call for a further 25% slump looks
    > positively bullish. We saw lows consistently around $66,000 in 1920,
    > 1932, and 1942. Postwar lows came in at $105,000 in 1976, 1983, and
    > 1996. These figures suggest the best case low is down a further 28%,
    > and the worst case is down another 51%. I think I’ll go find something
    > else to trade.
    Mar 18, 2009. 11:47 PM | 1 Like Like |Link to Comment
  • Volume Gives Shorts the Upper Hand  [View article]
    Although I am bullish, I thoroughly enjoyed the article. Great advice, simple, to the point, Thanks.
    Mar 18, 2009. 05:51 PM | 1 Like Like |Link to Comment
  • Housing Data Lifts the Markets  [View article]
    the Four Bears Chart is amazing in that the current plunge is as bad or even worse compared with the 20s. Meanwhile, the economic stats are not even close to the GDs, and are better than 70s and probably 80s. On top of it all all, the government is methodically delivering jab-jab-punch-uppercut to to the head of this bear and it surely feels like a medical attention will be required soon enough. we know where you stand, yea, keep on shorting America...
    Mar 18, 2009. 05:05 PM | 1 Like Like |Link to Comment
  • Two More Reasons I Think Housing Has Hit Bottom  [View article]
    Here is a million dollar question: which is more accurate OFHEO or Case-Schiller? I personally have heard heated arguments over the question. My take is: it depends on your perspective on what areas of the country you are concerned about. Case-Schiller tends to emphasize big city center prices, while OFHEO is more "spread out"... When you are saying housing is rebounding, what do you mean by that? Housing in Midwest, or in NYC, where I happen to live? IMO, NYC just started to correct. "Urban" SoCal, otoh, is almost done. JMHO.
    Mar 18, 2009. 04:51 PM | Likes Like |Link to Comment
  • Two More Reasons I Think Housing Has Hit Bottom  [View article]
    the Fed announced today it will be helping with lower rates long enough to see us through...

    On Mar 18 10:46 AM MGA_1 wrote:

    > Well.. housing still hasn't hit the historical mean. Additionally,
    > the Alt-A and Option Arm resets are going to be coming due later
    > this year which will only add more houses to the outstanding inventories.
    > I guess with interest rates extremely low one shouldn't be surprised
    > that people are building houses again, but I can't see this lasting
    > long term.
    Mar 18, 2009. 04:46 PM | Likes Like |Link to Comment
  • Bears Forced to Cover Shorts  [View article]
    I am a big fan of yours. Does not suit you well to post the market summary only though. Post your ideas! They are always refreshing.
    Respectfully yours.
    Mar 18, 2009. 04:41 PM | Likes Like |Link to Comment
  • Markets on Track for a Turn  [View article]
    yes, freddy... THIS TIME its different! where have i already heard it?

    On Mar 18 11:32 AM freddyv wrote:

    > This is all based on thinking that is outdated and belongs in the
    > 1980's, 1990's or 2000's but will not work going forward.
    > Finding one piece of (supposedly) bullish data amongst hundreds of
    > bearish points will no longer serve you well as an investing approach.
    > Your supposition is that people only need a few months to build up
    > their savings and their 401k's and to pay off their debt.
    > Your supposition is that demographics continue to point to a populace
    > with the largest contigent entering peak earning years rather than
    > declining earnings and a need to draw money out of their 401k's.
    > Your supposition is that P/E ratios really are 10 for the S&P
    > 500 when in fact current P/E ratios are 50 and will rise for the
    > next few quarters. Because we have been lied to and are lying to
    > ourselves about this it will come as a huge shock when Bloomberg,
    > the WSJ and even a few analysts begin to report the truth about earnings.
    > See www2.standardandpoors....
    > Your supposition is that the housing debacle is over.
    > Your supposition is that all of the money that flowed from government
    > to failed business will be paid back and will not become a burden
    > to the taxpayer.
    > Your supposition is that the stock market has fallen so much it can't
    > go any lower. Do a bit of research on this and you will find the
    > the stock market is only at fair value but has been well over for
    > some two decades. The universe seems to like keeping things in balance.
    > Your supposition is that Eastern Europe and Europe as a whole will
    > be fine.
    > Your supposition is that China, even if it doesn't recede further,
    > will somehow help us even as it causes commodity prices to climb.
    > But China feeds off us, it does not help us except to buy our treasuries
    > and its stimulus may cause that to slow.
    > Your supposition is that Meredith Whitney and Nouriel Roubini, the
    > two people who have gotten things right so far, are wrong.
    > Your supposition is that people who have gotten all of this wrong
    > are right.
    > Good luck to you. I know I always go with the one data point that
    > supports my prior beliefs over a whole bunch of data that refutes
    > them.
    Mar 18, 2009. 01:20 PM | 1 Like Like |Link to Comment
  • George Soros, Reflexivity and Market Reversals  [View article]
    I have been a long time fan of Soros, and have even read some of Carl Popper's works. If current meltdown is not a manifest to the wisdom of this view, I dont know what else is. We started with serious but not catastrophic subprime issue and it has blown up to be GD II. Or so the fatcats made us believe so. Think about it, where do you get all your info from?

    I am hoping you are correct about the imminent turnaround. I have no doubt it will be violent. Whats interesting is the few angry comments to your piece. A month ago you would have been creamed, trust me. I am also observing few folks who's been long time believers in some equities they were holding, but who are selling now. I highly suspect they are the last ones exiting, as I know the level of their past convictions.

    Also, notice how much media tune has changed in the past weeks. The financial entertainment talking heads are looking for good news. I do believe in the conspiracy theory that the money bags are now satisfied with the cash they have gotten out of taxpayer and will start putting positive spin on things. Just watch. they will cheerlead us into another boom, following this bust they 've been dragging us to privatize their losses.
    Mar 16, 2009. 10:20 PM | 3 Likes Like |Link to Comment
  • FASB 157, Mark-to-Market Accounting and the Uptick Rule  [View article]
    "I was a sell-side equities analyst for banker's trust/deutsche bank for 8 years"

    well i am sure you are a smart guy.. but its very hard to pull my leg, i have fought in this war for a long time, buddy... for 16 years, as structured products modeler, analyst, risk manager, you name it... both sell and buy sides. Oh, on capital markets side of things, not equity. kinda sounds im a bit more out there in the trenches... but hey, maybe you have a better view from out above there...

    wanted to do a long write-up to back up my claim, but i'm sure you've heard all it all.. our little disagreement will be easily resolved when the changes to FASB rules are implemented and the market reaction is known over some protracted period of time.


    On Mar 12 11:49 PM The Daily Bail wrote:

    > Gtarras.
    > I was a sell-side equities analyst for banker's trust/deutsche bank
    > for 8 years.
    > So your statement that I have no clue is ludicrous.
    > Did you even read the David Reilly piece from Bloomberg?
    > Only 28% of all bank assets are marked to market.
    > There is stuff all over the street marked above .80 cents that wouldn't
    > fetch .40 on the market.
    > Wake up.
    Mar 13, 2009. 02:12 AM | Likes Like |Link to Comment
  • FASB 157, Mark-to-Market Accounting and the Uptick Rule  [View article]
    "Does anyone really believe that financial institutions mark their assets correctly?"

    I do it for a financial institution and I KNOW they are done correctly, i.e. people DO mark them to market (whatever it is) levels. Try to mess with my internal and external auditors. You have no clue how things work, sorry.
    Mar 12, 2009. 10:13 PM | 2 Likes Like |Link to Comment
  • Are We Off the Bottom Yet?  [View article]
    Stop your fudgy nonsense and show us some numbers. And the numbers are telling us that commercial RE is 25% of residential in notional value. How big should commercial RE losses be for them to dwarf resi?
    Mar 12, 2009. 10:09 PM | Likes Like |Link to Comment
  • Why Felix Should Walk Away  [View article]
    You are bringing over this Russian mentality of "high moral standard" here to this society, thank you Alex! Why dont you think of moving back there, to good old Russia, where they wont think twice before phucking with you and your money? Dont bother you with morals? So why is it an OKEY for you to live without morals, but expect others to have them, huh? By the looks of it, you prefer living in Cali, rather than Moscow, I really wonder why?

    On Mar 05 03:18 PM Alex Filonov wrote:

    > Debt is secured. Felix by law can walk out of the mortgage if he
    > feels like that. What's wrong with this picture? By walking out Felix
    > doesn't break contract, bank takes collateral, everybody should be
    > happy. Bank took this risk when it wrote the contract, bank expected
    > home values to go up forever. Well, assumption was wrong and bank
    > lost money.
    > Don't bother me with morals. Felix is no more morally obligated to
    > continue paying this mortgage than bank was obligated to properly
    > estimate risk and write sensible contract.
    Mar 5, 2009. 05:48 PM | 1 Like Like |Link to Comment
  • Why Felix Should Walk Away  [View article]
    "So I don't think that Felix has any kind of moral obligation to the lender, nor to the sophisticated financial institutions which ended up buying the lenders' mortgages and who should have known exactly what they were doing."

    Thats the reason I am torn whether I should stay in America or go back to the old country (i immigrated here 20 years ago). What happened to the country I loved? Probably people like Salmon, who claim IT IS AN OK TO SCREW PEOPLE WHO LENT YOU MONEY!!!!! What a moral decay!!! It is actually getting more and more pronounced in the whole culture... it is called "SCREW EVERYBODY".. IS NOT IT ONE OF THE DEADLY SINS, FELIX?
    Mar 5, 2009. 05:24 PM | 6 Likes Like |Link to Comment