southsider2k5

QUOTE (NorthSideSox72 @ Mar 10, 2009 -> 08:19 AM) I can confirm that #2 has been underway for a while, CME wants to do it. But I don't know if the feds are pushing the issue to get going faster, or if they are promising any sort of funding. If the CME is interested, I am guessing the hold up is finding enough capital for marketmakers to be able to function with. I am surprised they haven't put something together for Globex yet, but at the sametime, how do you standardize a product like that? It would be interesting to see what their prod/dev team is doing with it.

QUOTE (daa84 @ Mar 9, 2009 -> 08:23 PM) barring major injury theres almost no way he doesn't go 1 Only if Borass prices him out of Washington's budget...

QUOTE (NorthSideSox72 @ Mar 10, 2009 -> 07:51 AM) A couple thoughts on this discussion... 1. If you stop MTM valuation, you have to replace it with something. What model or models are the people who want to stop it, suggesting we use to replace it? 2. The government would be smart to heavily back efforts to get clearing houses and organized exchanges online for fixed income and swap instruments. That is a big part of why these parties were able to trade into such high risk - there wasn't anything binding them into the consequence of each transaction on their risk profile. 1.Dollar/cost averaging is the system that makes the most sense to me. 2.Rumor on the street is that the have been pushing the CME to get into this business. Don't know if that is true or not, or in what form it would be, but that's just what has been said.

Ross: Its actually not a bad thing that you are experiencing this now and not later. One thing that I have learned in my professional life is that many times what you want to do with your life doesn't work out. Unlike our grandparents generation, odds are hugely in favor of you doing multiple different things with your life. To me the most important thing I got out of college wasn't the course work, but the learning and life skills. I have probably changed careers about 3 times within the same industry. For what I do things are constantly changing. The dirty secret about college is that no matter what you learn, you are going to go into the "real world" and they are going to re-teach you how to do things the way that they want them done anyway. The big thing that I got was the ability to learn. The end of college is only the beginning of your education. Heck as we speak I am studying for licensing exams with the NASD. Make sure you solidify your study techniques and figure out exactly how it is you learn best, because you will have no one to depend on but your self if you want to advance in whatever you get involved in. If you think you are doing it own your own now, it only gets worse. For me the important thing was picking out something I knew would give me a chance to live a respectful life style financially, while still being material I was interested in, and could see myself dealing with on a daily basis. Looking back the activities I got into also made a large difference in my life, as they provided me with some valuable skills. My years in radio, and being a program director at the station, were huge. Don't cut those kind of things out if you still enjoy them. If you don't enjoy them, find something else you are interested in and try it out. Finally, I know it sounds hard, because I did the same things at your age, but don't let it eat at you too much. At 19/20 years old, one simply doesn't have the foresight of being able to make these kind of decisions. You have no idea what life is going to throw at you, because every one's life is completely different. Do the best that you can today, and be ready to change things tomorrow. When it happens, it doesn't mean something is wrong, its just different. There isn't anything you can do about, so don't stress about it. Get that degree, keep working hard, and most important of all, enjoy these four years. Life completely changes when you are out of college, and you never get those years back. Soak them up as best as you can.

QUOTE (Balta1701 @ Mar 9, 2009 -> 08:02 PM) The problem is, everyone knows that the government simply can only go so far backing these assets before people simply aren't going to want to bail them out any more. What %age of Citigroup do we own now? I mean, just look at the numbers. Citigroup's total market value right now is what, about $10 billion? (Haven't done the math today, it was around that # on Friday). Look at the deal the Federal Government struck with Citi in November. Citigroup would take the first $29 billion in losses on their securities. For the next $272 billion, the losses would be split 90/10 with the government taking 90% of the losses. Out of their first $330 billion in losses, the Fed was going to absorb $245 billion. The U.S. government has guaranteed to take on $245 billion of Citigroup's losses, basically agreeing to pay Citigroup $245 billion, and their total value now has dragged itself below $10 billion. The only way that makes sense is if the markets currently think the losses Citi is going to take will overwhelm $245 billion from the government, since Citi supposedly has $108 billion in emergency reserves based on that report that I just posted. The Federal Reserve has expanded its balance sheet by $2 trillion over the past year, buying up these assets. The Fed has guaranteed $245 billion in Citigroup's assets directly. And yet, the market still thinks that Citigroup is nearly worthless. The market certainly isn't always wise, but the numbers there are staggering. They're expecting Citigroup to be unable to cover $350 billion in losses. One more thing I didn't think of explaining last night, that you all probably don't know... market cap is the valuation of a company, simple enough, right? For a bank, its not. Once again because of the ill-fitting accounting laws, a banks value isn't as simple as what their assets are worth plus or minus a forward valuation of earnings or loses. Because of the capital ratio laws of the Depression era banking changes, plus the genius of Sarbanes Oxley, a bank that has an 89% capital ratio, is worth the same thing as a 0% capital ratio, because they are both insolvent. Technically at under 90% the bank is taken over by the government, they charter is revoked, and their stock is cancelled. The numbers actually make sense. I tried to google assets under management for C, and found a number from the end of May that stated they had $1.8 trillion in assets under management. Which means they probably lent out something like 1.5 to 1.6 trillion dollars against it. Take losses of $350 billion in valuation write downs, and you are insolvent. This is write down of about 20% of total valuations. Citibank still has assets of about 1.4 to 1.5 trillion dollars under management, but is technically worthless and doesn't exist if the Fed weren't pumping up their books to keep them at that 90% ratio. They are worth $10 billion in market cap today because the market doesn't believe the Fed can keep pumping in money until their assets start to appreciate again. This is another perfect example of how easy it is to make numbers lie to people who don't understand them. Realize that under your theory of an asset being worth what someone is immediately willing to pay for it, C would have gone under 6 months ago, even with government help, and we would have been on the hook for the majority of that 1.8 trillion dollars.

QUOTE (Balta1701 @ Mar 9, 2009 -> 08:02 PM) The problem is, everyone knows that the government simply can only go so far backing these assets before people simply aren't going to want to bail them out any more. What %age of Citigroup do we own now? I mean, just look at the numbers. Citigroup's total market value right now is what, about $10 billion? (Haven't done the math today, it was around that # on Friday). Look at the deal the Federal Government struck with Citi in November. Citigroup would take the first $29 billion in losses on their securities. For the next $272 billion, the losses would be split 90/10 with the government taking 90% of the losses. Out of their first $330 billion in losses, the Fed was going to absorb $245 billion. The U.S. government has guaranteed to take on $245 billion of Citigroup's losses, basically agreeing to pay Citigroup $245 billion, and their total value now has dragged itself below $10 billion. The only way that makes sense is if the markets currently think the losses Citi is going to take will overwhelm $245 billion from the government, since Citi supposedly has $108 billion in emergency reserves based on that report that I just posted. The Federal Reserve has expanded its balance sheet by $2 trillion over the past year, buying up these assets. The Fed has guaranteed $245 billion in Citigroup's assets directly. And yet, the market still thinks that Citigroup is nearly worthless. The market certainly isn't always wise, but the numbers there are staggering. They're expecting Citigroup to be unable to cover $350 billion in losses. And why are they worthless? Because the people at the top keep saying that they are. None of this stuff will begin to solidify until the marketplace gets some confidence in the actions of the government. Right now they have no reason to believe things will be getting better anytime soon, because they keep getting told they won't.

QUOTE (kapkomet @ Mar 9, 2009 -> 03:16 PM) CKnolls, Do you agree we see 10%+ bounce if we get rid of mark-to-market? Huge upside, IMO. I don't know about Dr J's bet of the doubling of the financials, but I would bet on a 25% bounce from that sector. I don't know how many SP/Dow points that translates into, but it will be one hell of a rally. It may well put in the bottom of this market.

http://blogs.chicagosports.chicagotribune....ng-version.html

QUOTE (caulfield12 @ Mar 8, 2009 -> 01:33 PM) As for Floyd, he has much better raw physical ability than Danks and just about every other pitcher in baseball. If Floyd can keep it together mentally, he's going to win even more games than the eye-popping 17 last season. www.dailyherald.com/story/?id=277539&src=162 That and the insight that we won't see Contreras until May. John Danks was consistently throwing 92-93-94 for most of last season, I don't get where so many people shortchange him and treat him more like Mark Buehrle. He was a first round draft pick, too. I don't think you can make the statement Gregor does simply based on the fact that Floyd has an awesome curveball when it's on, which is about 30-40% of the time. Yes, there are lots of pitchers that have the ability to be the best in baseball based on pure stuff alone, but a little hyperbole for your Sunday morning...I think everyone in White Sox Nation would be pleased as punch if Gavin somehow managed 15 wins this season. Gregor predicting 18 or more? Well, he's out on a limb, I hope he's right. On this team, I would say Danks gets more out of his stuff than anyone except Mark Buehrle. I can actually agree with Gregor if you word it a little differently. I really believe that Gavin Floyd has better pure stuff and potential than Danks does. Danks just has a HUGE edge in the mental aspect of the game, which we all know how important that is in the game of baseball. Gavin Floyd is blessed with more potential and stuff than most of baseball. He just has to learn to harness it.

I'd love to see Valpo product Scott Drew and Baylor manage a second round upset and beat Kansas.

QUOTE (Tony82087 @ Mar 9, 2009 -> 12:30 PM) Williams deserves a lot of credit right now. As you say, every day more and more it seems like this team is going to compete for a division crown in 2009, while at the same time Williams has started to re-build the farm with high end players like Beckham, Poreda, Viciedo, Allen,Flowers, Shelby, and Danks. Along with that, the influx of Danks-Floyd-Quentin-Alexei has made the current major league core something to get excited about. On top of it all, there isn't a long term deal on the books right now that is really hurting the franchise. Pretty nice spot to be. The funny thing was everyone laughed at Kenny when we had the worst farm system on the planet and he said it would take no time to fix it. It took him all of a year and a half to get it back to respecful, contributing levels.

Speaking of mark to market, here is a great article from someone I actually worked with back in the day. http://www.cnbc.com/id/29549920

QUOTE (Balta1701 @ Mar 9, 2009 -> 12:42 PM) Ok, so basically, to first order you're adopting the Treasury/Fed position that these assets are going to be worth more in the long run than they are now and the banks are being forced to underwrite them because no one else wants to risk holding them right now. I'm taking the position that $8 trillion + of wealth has vanished and these securities are still over-valued, to the point where having a genuine value placed on them would send the banks in to bankruptcy. If you're right, then TARP is a hell of a deal for the taxpayers and for the Fed, as is the nationalization of the GSE's, and there will be an end to this if we buy time by continuing what we're currently doing. If I'm right, then the only end to this is to have the government take the losses and break the banks apart in to entities that are no longer too big to fail. I'll leave it at that. Good discussion. When the underlying pieces of a products are still worth 50-75% of the original cost of the asset, the proper valuation of the whole is not 5% of original cost. The proper valuation should be an aggregate of the pieces of the whole. Even though there isn't a market place for these things anymore, there is still the easy underlying asset to judge proper value on. These aren't binary options. There are still real, tangible assets making up these products. I agree about the too big to fail part, except the agencies that I want to see broken apart are the agencies who started giving inflated valuations to these commodities in the first place in Freddie and Fannie.

QUOTE (Balta1701 @ Mar 9, 2009 -> 12:19 PM) But is it not true that the thing that is forcing the banks to write down these assets is the fact that they're losing money on the investment in the first place? You and I both seem to be agreeing that the mortgage and other debt-backed assets are simply worth less than what the banks are accounting them as right now, as you said, no one will buy up something if they think they'll lose money on the deal. You seem to be taking a position that makes no sense to me; these things are worth less than the banks are saying they're worth, so we should allow the banks to pretend they're worth even more so that the banks don't have to take the write-downs, thus improving the condition of the banks' books. The only way that allowing the banks to pretend these assets are worth even more will help is if the assets really aren't as bad as everyone thinks they are. I don't know if I need to point out the numbers again but I'll do so. 1/5 of American homeowners are now under water, at the point where they owe more on their mortgage than their home is worth. 1/8 homeowners are either behind on their mortgage or are somewhere in the foreclosure process. And the Housing Market still has a ways to go. I posted the other day that AAA rated assets made up of mortgage backed securities from 2006 and 2007 were returning $.05 on a $1 investment. These assets are simply garbage. There is no other way around it. There's a reason why these assets are treated by everyone other than the Fed as worth less than what the books of the banks say they're worth. Because they're already bad, there's every reason to believe they're going to get worse, and no one wants to be the one caught holding them when the free money trains from the government run out. Actually I think we are saying two completely different things. I am saying you don't have to have a trade to have proper valuation take place. Forcing the market to recognize prices that probably don't refect reality, and making banks fail for that is just dumb policy, especially when it is forcing us into a gynormus debt situation and ruining the economy. The private sector recognizes how randomly these valuations are taking place and wants nothing to do with them. That is a rational market decision. You can't really tell me that you believe the actual market value of mortgages from two/three years ago is less than 5% of what they were worth then, yet we are supposed to assign those values to banks?

QUOTE (Athomeboy_2000 @ Mar 9, 2009 -> 12:20 PM) I believe financial "experts" on CNBC said the same thing: .cc_box a:hover .cc_home{background:url('http://www.comedycentral.com/comedycentral/video/assets/syndicated-logo-over.png') !important;}.cc_links a{color:#b9b9b9;text-decoration:none;}.cc_show a{color:#707070;text-decoration:none;}.cc_title a{color:#868686;text-decoration:none;}.cc_links a:hover{color:#67bee2;text-decoration:underline;} The Daily Show With Jon StewartM - Th 11p / 10c CNBC Gives Financial Advice Daily Show Full EpisodesImportant Things With Demetri Martin Political HumorJoke of the Day Then again one of those is actually in Congress with the ability to influence policy.

QUOTE (Balta1701 @ Mar 9, 2009 -> 11:53 AM) I'm pretty sure this is my point exactly. The problem is that these assets are worth significantly less in the long term than what the Banks are accounting them as worth today, and everyone knows it. Hence, repealing Mark to Market, allowing the banks to pretend they're somehow worth even more, isn't going to make a bit of difference except perhaps to kill off any bank that's run by anyone stupider than the people running C and BOFA. It makes a big difference, because it is the write downs that are killing the banks right now. If they weren't writing down assets, we wouldn't have a probelm. Even if they aren't what you judge them to be, they are murdering the capital ratios of banks and making money just disappear from the system. Speaking as someone who actually deals with securities valuations on an everyday basis, its also worth noting that just because there isn't someone who is willing to pay a price for something, doesn't mean that is not what they are worth. Exchanges give valuations to all kinds of things all of the time which aren't based on trades. Heck I would estimate something like 95% of all exchanged based options contracts are settled on a nominal value, and not a traded actual value at the end of the day. Valuing these securities at something other than a traded price is the overwealming common practice.

I am a big fan of the 3-2-1 point system. It promotes teams to be aggresive instead of passive towards the end of games. http://sports.espn.go.com/nhl/columns/stor...&id=3962804

QUOTE (lostfan @ Mar 9, 2009 -> 11:45 AM) It was supposed to induce chuckling, you totally killed it. ^^^

QUOTE (Balta1701 @ Mar 9, 2009 -> 11:36 AM) Because the assets are worth far less to everyone except the Federal Reserve than what they've been written down to, and there are other assets that probably haven't been written down yet at all (credit card debt, commercial real estate holdings). That's why I'm saying that the problem isn't mark-to-market. The balance sheets of BOFA, C, etc., have so much of this bad debt on them that if they wrote them down all the way to where they need to be, the banks would be closed. It's only these accounting games where they can dump piles of the stuff on to the Fed/Treasury and delay the write-downs in the hope that things recover that has kept them from going in to the red. Edit: Just look at the signals from the market if you don't believe me. If these assets were worth so much more than the nearly-zero returns they're generating currently, then people would be trying to scoop them up at bargain rates. They're not. If these assets were worth so much, then someone other than the federal reserve would be interested in buying them at the discount rate. If these assets were in the long run going to be worth more rather than less, then why is Citibank's stock worth what I pay for lunch over 2 days despite having $50 billion in guarantees from the Treasury? It's because no one else out there wants this stuff, and no one believes it's worth enough for these banks to be viable unless they can dump even more on to the government. No one is buying this s*** because they have no confidence in the system. The response by both administrations has been a clusterf*** of enormus proportions that has show no one enough confidence in the system to where they feel that a bottom has been put in in asset valuations. This doesn't just mean the stock market, but all of the assets backing all of these securities. Why would you buy something that you are pretty convinced will be worth less tomorrow than it is today? The answer is, you don't. You wait until you are pretty convinced that the bottom has been put in, even if this means missing the absolute lows of valuations. This is the exact type of reason I keep going back to the market being scared of the current President. He has yet to be able to convince the people who employ people in this country that their business will be safe and sound tomorrow. I heard Mort Zuckerman on Meet the Press say it best yesterday. To paraphrase he said the President while popular, isn't very inspirational.

QUOTE (Athomeboy_2000 @ Mar 9, 2009 -> 11:36 AM) Vary weird... and completely inaccurate: Albert A. Gore, Jr. - March 31, 1948 Hillary Rodham - October 26, 1947 John F.. Kerry - December 11, 1943 William J. Clinton - August 19, 1946 Howard Dean - November 17, 1948 Nancy Pelosi - March 26, 1940 Dianne Feinstein - June 22, 1933 Charles E. Schumer - November 23, 1950 Barbara Boxer - November 11, 1940 Damn that's more strikeouts than Nolan Ryan

QUOTE (lostfan @ Mar 9, 2009 -> 11:25 AM) E-mail I got today: Holy s***, now we know why Bush and Reagan wanted star wars so badly... It's not the Russian, but the aliens he wants to blow to smithereens! These bastards must be stopped!!!

http://www.telegraph.co.uk/news/worldnews/...rdon-Brown.html -Joe Biden

lol, I should click links once in a while... Anyways, gotta love the reset button. I am glad the "Bushisms" ended with Bush.

QUOTE (Steve9347 @ Mar 9, 2009 -> 08:39 AM) I'm sure it's one of those nasty contusions on the shin and or knee that will heal with rest. You block a shot it hurts some times. Meanwhile, these are the worst two games the Hawks have played in a row this year. Really since Khabi went down, this team hasn't played well. We have had problems sustaining offensive pressure for a while now.

QUOTE (CryptviLL @ Mar 7, 2009 -> 02:10 PM) lmao never thought of that: http://en.wikipedia.org/wiki/Oakland_Athletics From a proper English standpoint, it makes sense. You are supposed to use an apostrophe to indicate the shortening of a word, such as a contraction. A's is just short for Athletics.