Augustus

Setting the Record Straight: Taxpayers Not Funding JP Morgan's Bear Buyout

Pretty artful way of explaining how the taxpayes will never miss getting the $2 Billion a year that they may otherwise get. I can agree that there has been little if any cost yet. And there may end up being a profit. The portfolio should be generating yields greater than the Fed Funds rate in any event so there could actually be a net income from holding these investments. However, trying to say that the taxpayer will not have any costs because any losses will just become "money not paid to the govt. and that is not a real cost" is simply deceptive logic.

Will JP Morgan Sweeten the Offer?

for Msg212,
1% of BSC bonds = $3 Billion.
10% of $3 billion in bonds = $300 Million => JPM price to buy.

Costs less than 0.1% of Bond value to "guarantee" that the deal closes IF it took all the shares to do that.

28/36- Why House Prices Must Fall

In earlier times the ratios were 25/33. And it worked pretty well. Maybe a slight bit of favorable skew for the first time homebuyer using a Govt program for a lesser priced commodity house. The idea of $1,000,000 houses with nothing down financing is nonsense.

Why Is Bear Stearns Trading Above Deal Price?

I sure hope that the reason for the price being up is that Joe Lewis is buying the shares and will take delivery of the securities. It will put the horrid squeeze on the naked shorts. It would be a wonderful story if it comes out that way.

Naked short bear raid. Gets out of hand and breaks company share price - but not company. Before the company has to go Bankrupt, the Govt steps in and saves it and keeps it alive. So that the assets are for sale at $2 a share with a book value of maybe $70. If those naked shorts did not cover yet, they are a real bunch of dumb pickles. If Lewis has been buying, it would not be that much of a double down for him. Particularly for a big currency speculator. If employees and Lewis already owned 40%, the other 60% would only be $120 mil at $2.

Whether it works out that way or not, it would make a great book. And, IF he could show that Morgan was involved in any of the naked shorting, a big Maybe and IF, he could end up owning the bank too. Reverse the coup. There is no If about this - lots of shares being traded that do not exist.

Cramer on Bear Stearns, March 11: Stick Around

Cramer definetly needs treatment from a psych.
I believe that if he was on the inside - he never would be let out to be on the street again.

Jim Rogers on the Bear Stearns Bailout

He's right about the bonuses. Except that they were in BSC shares. Now about worthless. He takes a good theme that some bankruptcies would not kill the USA. But then kills his own argument. Heh, Rogers, Ask that guy Joe Lewis if the Fed bailed him out?

Did the Fed's Move Prevent a Stock Market Panic?

Calling for more punishment for Bear is pretty silly. They are getting wiped out pretty thoroughly. Letting them go into default would really screw up all of the counter party trades they were involved with. That would be a very major disaster. Crashing a bunch of other institutions. Fed "help out" is by far the better outcome.