Cknolls

Does anyone think that C investment was so they could pay their dividend for the next 3 qtrs? Look what happened to FRE when they cut their dividend by 50% last week. C will do anything to avoid cutting their dividend, but methinks it is a matter of time. Lay off thousands of workers or cut the dividend? easy choice to me. Buy C at $25. Nice!!

Look at mortgage rates since the first ease. They haven't budged. In fact they are higher than they were a year ago. Look at the LIBOR. It is up 11 days in a row. It is trading 59 bps over the Fed Funds Rate.This tells you that banks are holding on to their cash. Oh yeah look at CFC. markey up 310. CFC in the red. All is not well.

QUOTE(southsider2k5 @ Nov 28, 2007 -> 12:48 PM) Answer: They shouldn't. Its inflationary. They don't seem to think so. Just exclude food and energy.

JPMorgan (JPM) estimates that Bank CDO Losses May Reach $77 Bln. Losses on collateralized debt obligations at the world's biggest banks may double to $77 billion, JPMorgan Chase & Co. analysts predict. Losses marketwide on CDOs linked to U.S. mortgages will reach about $260 billion, the New York-based JPMorgan analysts, led by Christopher Flanagan said in a report. "One of the benefits of securitization is the offloading and global distribution of risk," the JPMorgan analysts wrote. "Ironically, this is now a capital markets hazard, since no one is sure where subprime losses lurk." Bond insurers including Ambac Financial Group Inc. and MBIA Inc., which have "taken few reserves," own CDOs that have had $29 billion in losses, JPMorgan estimated. As of the November 11 2007 10-Q MBIA had $6.96 billion in working capital. As of the November 09 2007 10-Q Ambac had $5.65 billion in working capital. Assuming JPMorgan is correct (or even in the ballpark), a combined $29 billion in losses makes the guarantees of those companies essentially worthless. These may be the first in a long line of bankruptcies to occur from the Greenspan money train.

In a speech at the University of Rochester, Plosser said the Fed cannot resolve the cause of the tension in financial markets, uncertainty over the value of complex securities tied to subprime and other mortgages and who holds these derivatives. "It is important to recognize that the Fed cannot resolve this price discovery problem. The markets will have to figure this out," Plosser said in his prepared remarks. "Arbitrarily lowering interest rates or providing liquidity to the market does not provide the answers the market seeks," Plosser said. Indeed, rate cuts might only delay the painful process, he said. Philadelphia Fed President Charles Plosser strongly suggested that he is not in favor of an additional rate cut at the next policy meeting on Dec. 11. The only problem is: Plosser does not have a vote for the meeting. SO why lower rates???

QUOTE(NUKE @ Nov 28, 2007 -> 10:36 AM) How can you say we have been in a bear market since July when the Dow and S&P ran to new highs back in October? No. I may not be the most educated man when it comes to investing but I think this market finally got washed out early this week and has bottomed. Speaking of Countrywide and a few others that have been destroyed lately, who is to say they won't get a takeout bid down at this level? At 9 a share I could easily see them getting bought, especially since they've been cleaning up their books. P.S. Im really, REALLY glad I bought my Goldman when it was down at 205 a few days ago. I am simply saying that according to the DOW THEORY, we have been in a bear market since July. CFC is running out of money. They have borrowed over $52 billion dollars from FHLB in Atlanta. The only way they can attract money and originate new mortgages is to hand out over 5.50% on a 6 mo. cd. That is insane right now. Oh, and their dividend should be a goner too. The sharpest rallies occur in bear markets. This will not stick. I believe you have to sell the rallies instead of buy the dips.

QUOTE(southsider2k5 @ Nov 27, 2007 -> 01:28 PM) Historically 10% down has always been the definition of a correction. The 10% figure starts at the highest point of the bullmarket that was going on at the time. The high of the current bull was 14164.53 meaning the 10% correction mark was a little bit under 12750. A bull market would be declared with a 10% rally from the lowest close during this correction. But according to DOW THEORY we have been in a bear market since JULY. Why? Because last week we finally took out the lows in the DJIA. That was the only thing stopping a Dow Theory sell signal because the transports had already made a new low a couple weeks ago. So once they both make new lows you have to go back to their highs to find where the bear market started, and that would be in July. I just think this 10% number can be interpreted the same way people interpret when we are in a recession. I'm still $25 bid for C. And CFC is going to zero. Dow 12K if the Fed lowers rates 50 bps. All they will be doing is pushing the contagion further out on the curve.

QUOTE(southsider2k5 @ Nov 26, 2007 -> 07:23 PM) For those keeping score at home, the Dow was down about 240 today, and has now entered official correction territory. Why? because its down 10%? Where did that stat come from and who says that is the official CORRECTION?

QUOTE(jasonxctf @ Nov 26, 2007 -> 12:44 PM) www.270towin.com its funny. amongst all of the head to head matchups, questions that people ask about candidates. I ask this question about Hillary. Using the Electoral College, I don't see a way in which she loses for 4 reasons. 1) She'll win every state that Kerry won in 2004. 2) She'll win Arkansas (may be close if Huckabee is the top ticket, but he won't be) 3) She'll win Iowa (unless Romney is the nominee, which he wont be) because she actually campaigned there. unlike Guilianni, McCain and really Thompson. 4) She'll win New Mexico with Richardson as a running mate. Thus she can still lose battleground states in Virgina, Florida, Ohio, Arizona, Colorado and Nevada. That puts her exactly at 270. If Rudy is the nominee, would she win N.Y.?

The Republicans in MS, like the Dems in IL, could run martians and still have them elected.

http://www.azcentral.com/news/articles/111...censes1115.html Preach what we practice? NAHHHHHHH.

So were letting the dollar fall so we can take growth out of other countries? LOL So much for the strong dollar. How would you suggest we could raise the value of the dollar if we didn't want to take growth away from other countries?

Merrill Off-Balance-Sheert Shenanigans Drarw Scrutiny Meanwhile, in the real world, regulators may be investigating whether Merrill Lynch (MER) violated accounting rules to delay reporting of subprime losses, the Wall Street Journal reported. The heart of the Journal story rests on "unidentified people" who say Merrill engaged with some hedge funds in deals designed solely to delay disclosing losses on bonds or derivatives positions backed by subprime mortgages. The U.S. Securities and Exchange Commission has opened an informal inquiry and is likely to investigate the transactions, a person familiar with the investigation said apparently told the Journal. Ok, so what does all this really mean? What kind of "deals" are we talking about here? The deals effectively move the securities off the balance sheet of one of Merrill's sponsored entity's and onto the balance sheet of the hedge fund involved. How does that work? Well, Merrill prices the assets and the hedge involved fund agrees to "buy" the assets at that price and hold them for one year in exchange for a guaranteed minimum return. Sounds shady, huh? It's actually more common than one might think, and assuming the "pricing" is on the up-and-up, really not that shady at all. Where the water turns murky is in the pricing. In one case the Journal says Merrill sold commercial paper issued by one of its entities for $1 billion. If, for example, regulators were able to determine that the transaction was unreasonably priced - say, if the assets that were transferred for $1 billion were really worth $500,000 million - then this is a serious problem. In fact, then it becomes virtually identical to the off balance sheet transactions that were structured at Enron to hide losses. This story is just beginning. Unfortunately, if the old adage is true - news follows price - then Merrill's 11.8% move lower so far today is not encouraging for the outcome. also: Fitch Tosses a Little Kindling on the Fire According to Fitch there were $92.1 billion worth of US corporate bonds downgraded in the third quarter of this year – 88% higher than the $49.1 billion through the first half of the year. That's the highest level in almost two years, and worse, almost all of the cuts were on investment-grade borrowers. Investment-grade bonds accounted for $88.1 billion of the cuts, while speculative-grade debt represented just $9.9 billion. The industries most affected, as one might guess, were Finance and Banking. Meanwhile, Standard & Poor's today said its bond downgrades outpaced upgrades in the third quarter by the widest margin since 2003. S&P cut the ratings of 95 companies in the U.S. in the quarter and raised the ratings of 44, Bloomberg reported. Again, this story is just beginning as well

QUOTE(southsider2k5 @ Nov 2, 2007 -> 09:58 AM) Which is exactly what they are trying to do. They want all of the other currencies to be expensive. They are trying to stall out China and Europe, and lessen the profit of $100 oil in the middle east. The more I have read, the more I have realized they are trying to correct the trade balance with the weak dollar. Exports are booming, and imports are going to start getting really expensive. Its the best way to prop up industries like Steel and Auto. Its also the best way to slow down China's growth. I'm a seller with both hands. The Fed can't do anything about the falling dollar unless foreign centarl banks do it for him because the FED and the Treasury have no foreign reserves to speak of with which to defend the dollar. You can't buy dollars with more dollars. When you spew confetti into the system, you depreciate it even further. The U.S never needed to have foreign currency reserves given that it prints the world's reserve currency. Un fortunately, when you abuse that privelege, as the U.S Fed has repeatedly done over the past decade or so, the mkt eventually says, "No MAS", and you get a break down in the global monetary system, just as we are seeing today. The U.S does have one reserve asset, and that is GOLD Is it any wonder that gold is rallying in all paper currencies today, just as it did the last time the global monetary system broke down, in the eraly 1970's?

It's a global mkt, right? That's what they keep spewing on T.V. Well then any investor in the S&P 500 whose home currency is the Euro is now looking at prices below the August lows. Currency traders are telling you what they think of the Fed's cuts and the jobs report this morning. WAMU's dividend is now at 9.3%. If they maintain that dividend they will have to pay out 79% of next year's $2.83 EPS estimates. If anyone believes that, I have a bridge I would like to sell you.

Mortgage Lending and Financials were not the place to be on Thursday. Here is the scorecard: GMAC*, the home and auto lender formerly owned by General Motors (GM) reported a $1.6 billion loss on lower demand for mortgages and higher provisions for failed loans and impaired assets. Radian (RDN) , the third-largest U.S. mortgage insurer, reported a $703.9 million loss after writing off $468 million on a unit that invested in subprime mortgages. MGIC Investment (MTG), the largest U.S. mortgage insurer, declined $2.25, or 12 percent, to $17.11. Washington Mutual (WM), the largest U.S. savings and loan company, fell 7.6 percent. Countrywide Financial (CFC), the biggest U.S. mortgage lender, lost 7 percent. MetLife (MET) slipped 4.8 percent Conseco (CNO) dropped 10 percent, the most since emerging from bankruptcy in 2003. American International Group (AIG), the world's largest insurer, fell 6.1 percent. MetLife lost $25 million from its $1.8 billion of investments in 25 hedge funds in the third quarter, Chief Investment Officer Steven Kandarian told analysts on a conference call today. The New York-based company had another $47 million of losses linked to investments in homebuilders and CDOs. Ambac (ABK) bonds were downgraded to "deteriorating'' from "stable'' by Gimme Credit Publications Inc. because of the world's second-largest bond insurer's risk from CDO obligations. *GMAC is majority owned by a buyout group led by New York-based Cerberus Capital Management LP. GMAC's results included a $2.3 billion loss at its Residential Capital LLC mortgage unit. The above synopsis thanks to Bloomberg. I am still trying to figure out how anyone could possibly have been interested in buying GMAC from GM. Even more puzzling was GM's reluctance to part with all of it as opposed to 51% of it. Urgent Message From Citigroup © The Mortgage Lender Implode-O-Meter is noting an Urgent Policy Notification from Citigroup: Effective October 31st 2007, Citi Home Equity will discontinue lending on all Purchase Money transactions for properties in California.

MER. downgraded to HOLD at Deutsche Bank. Barclay's shares falling 8% in Eurpoe amid funding woes and speculation that the company is telling analysts to cut profit forecasts.

There is no way the Fed would report a weak number this morning. The mkt sniffed it out and showed the Fed what to do with their numbers. There is just too much bad paper held by the Financials. GS is holding $72 billion dollars worth of level 3 paper. They are supposed to be the best on the street. Granted, not all of that is subprim e, but that is still a lot of weak paper. GS down 10.90 btw. 225 big number for that stock.

So the Fed wants us to believe that jobs were ADDED in the real estate and financial sectors in OCTOBER. LOL

Spx blew through 50 DMA this morning. The 200 DMA is a whisker under 1482. If we close below here methinks all bets are off for the bovine crowd.More importantly, a break of 1489.55 will turn the monthly chart to the negative..This is very similar to the failure in October of 2000. The October rally failed to take out the March highs of that year.

It isn't a coincidence that the VIX is up almost 27% today and the mkt is in the toilet. Also watch the dollar. IF the $ rises dramatically, I believe stocks will get crushed. Asset inflation vs. dollar denomination

There were 635,159 foreclosure filings in the quarter, or one for every 196 households, including default notices, auction notices and bank repossessions. The rising foreclosures is further pressuring home prices on a national level. Not one of the 10 major cities tracked has shown price appreciation for four consecutive months.

But they keep soliciting people with credit card offers in the mail on a daily basis. And when the s*** hits the fan, they'll be wondering how it all happened.

Tomorrow, the SPX closing below 1530 on a weekly basis would signal 1490/1500 area, especially if the jobs report tomorrow comes in weaker than expected. 1493 is the midpoint in the SPX for 2007, IIRC. 1533 is also the midpoint for SPX in October.

QUOTE(NorthSideSox72 @ Nov 1, 2007 -> 01:32 PM) Jeez. Here you go: http://www.federalreserve.gov/releases/g19/Current/