US Banks (2008)

Discuss your favourite picks, broker, and trading or investment style.
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adrian2
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Post by adrian2 »

arthur wrote:adrian, give me a break, like I need to try to impress
Oh yeah, oh yeah.
arthur wrote:just stated facts
Oh no, oh no.
arthur wrote:you have a problem with that, well that is your problem.
I see only a famous Louis de Funès comedy from my youth.
arthur wrote:I give up, I'll keep my trades to myself, sometimes it just ain't worth the energy.
The strong and quiet type, making a "wad" of money.
arthur wrote:Petty.
AKA Howard.
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Post by WishingWealth »

De Funès: I never thought he was in that many movies.

To what he would have answered "Oui mon adjudant!"

WW
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Mike Schimek
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Post by Mike Schimek »

More fun from Jim Rogers, for anyone that enjoys listening to him;

http://www.cnbc.com/id/15840232?video=793635578&play=1

One part that's very entertaining about the clip is early on the interviewer says/asks some questions that certainly don't seem very smart (I guess they hired her for her looks), and Jim finally gets irritated and basically says she should be fired or shouldn't be working doing the job she is doing lol! That's the first time I see an interviewee knock an interviewer on the head that hard in this type of news clipping.
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arthur
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Post by arthur »

adrian, as I have noted before, I am used to being the object of envy, the fact that we were able to do what we did, hold the job positions that I did, the worker bees always buzzed how much better they could do things If Only, but they stayed worker bees bcasue that was their level of competence.

Not sure how many years ago you came to this country adrain, it is probably a cultural thing??

BAC may take another good hit, the dividend Yield says so, might b a reenter, but I am not saying.

10 weeks to go, then off to Florida, for six months, life is tough, today, time to go sailing, probably afte we play 9 holes. :lol: :lol: :lol: :lol:
You want the truth, you want the truth, you can't handle the truth.

The masses have never thirsted for the truth, whoever supplies them with illusions is their master, whoever supplies them with the truth, their victim.

If you do not risk anything , you risk even more. Jong
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adrian2
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Post by adrian2 »

I will only note, in addition to all the mis-spellings of your mother tongue, you consistently write "Sons" capitalized and again manage not to capitalize my name twice in the post above, plus (intentionally?) spelled it wrong once.

Some visit to a medical professional other than your wife might be useful, possibly for treating the condition I've alluded to previously.

Enough with the off topic messages.
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Post by Jo Anne »

adrian2 wrote:...again manage not to capitalize my name twice in the post above...
adrian2, perhaps you haven't noticed, but you don't capitalize your name.
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Post by twocentsworth »

Glad you picked that up Jo Anne...I wasn't brave enough to point out the obvious. 'Course Adrian/adrian is absolutely correct about Howie's/hooey. :lol:
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adrian2
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Post by adrian2 »

Jo Anne wrote:adrian2, perhaps you haven't noticed, but you don't capitalize your name.
"adrian2" is an alias which is not capitalized; Adrian is a first name which is capitalized.
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Nemo2
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Post by Nemo2 »

adrian2 wrote:
Jo Anne wrote:adrian2, perhaps you haven't noticed, but you don't capitalize your name.
"adrian2" is an alias which is not capitalized; Adrian is a first name which is capitalized.
So, um, was Arthur responding to adrian2 or Adrian? :)
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Shakespeare
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Post by Shakespeare »

So, um, was Arthur responding to adrian2 or Adrian? :)
Er, that's arthur, not Arthur. :wink:
Sic transit gloria mundi. Tuesday is usually worse. - Robert A. Heinlein, Starman Jones
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Post by Nemo2 »

Shakespeare wrote:
So, um, was Arthur responding to adrian2 or Adrian? :)
Er, that's arthur, not Arthur. :wink:
What, now there's four of them??? :shock:
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parvus
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Post by parvus »

Mike Schimek wrote:More fun from Jim Rogers, for anyone that enjoys listening to him;

http://www.cnbc.com/id/15840232?video=793635578&play=1

One part that's very entertaining about the clip is early on the interviewer says/asks some questions that certainly don't seem very smart (I guess they hired her for her looks), and Jim finally gets irritated and basically says she should be fired or shouldn't be working doing the job she is doing lol! That's the first time I see an interviewee knock an interviewer on the head that hard in this type of news clipping.
To be fair, there's two issues. Bernanke says Fannie and Freddie are solvent; Rogers disagrees.

But this week, there was also a lot of concern about short-seller "whispers." I think short-sellers are essential to the market; Bertha seems to be tapping into the plaint of many a CEO and politician that short-sellers are talking down stocks.

I don't happen to think that's true (the accusers don't seem to have heard of a short squeeze). But certainly, naked shorts are against the rules, and should be prosecuted: you shouldn't be able to short a stock you haven't borrowed through a prime broker or depositary bank.
Last edited by parvus on 20 Jul 2008 14:19, edited 1 time in total.
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Shakespeare
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Post by Shakespeare »

naked shorts are against the rules
I think all naked shorts should be banned and the uptick rule reinstated. Banning naked shorts only on some stocks is worse that bad, since it creates two classes of stocks: ban all naked shorts or ban none.
Sic transit gloria mundi. Tuesday is usually worse. - Robert A. Heinlein, Starman Jones
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Post by ModeratorQ »

adrian2 wrote:Enough with the off topic messages.
Enough period!!!!!

WTF is the matter with you two??????????????? You don't like each other?? OK. No problem. Use the ignore function and keep this ongoing childishness to yourself.
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adrian2
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Post by adrian2 »

Shakespeare wrote:
naked shorts are against the rules
I think all naked shorts should be banned
Naked shorts were always banned; for some time the rule was not enforced.
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Shakespeare
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Post by Shakespeare »

for some time the rule was not enforced
So why only flag some stocks for that enforcement? Idiotic. :roll:
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adrian2
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Post by adrian2 »

Shakespeare wrote:So why only flag some stocks for that enforcement? Idiotic. :roll:
One has to start somewhere, makes sense to deal first with the biggest offenders.
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Post by mw »

parvus wrote:To be fair, there's two issues. Bernanke says Fannie and Freddie are solvent; Rogers disagrees.
Rogers is certainly is prone to exaggeration - I wish he'd avoid this because my credibility meter dips big when pointed at folks who resort to stretching the known facts to bolster their point. Talking his book and highly motivated to do so at present. That doesn't automatically make him wrong on his market bet though.

Has anyone noted a useful review of the risk profile of FNM and FRE mortgage holdings? Rogers' hyperbolic opinion that all 4 or 5 trillion is at risk can't be correct.

It seems to me the issue isn't so much whether FRE and FNM are solvent - doesn't matter so much in the long run, as the credit portfolio, whatever is beyond junk status anyway, will be bought by others - but how much of that portfolio is crap and therefore likely to further impact housing prices.

Side note, article in the Globe and Mail on Saturday The house that IndyMac built is worth a read. The on-line photos aren't nearly as impressive as the dowdy picture presented in the print version, but the entire article is currently online:
LOS ANGELES, TORONTO and NEW YORK — Patricia Ramirez's home, which sits on a ragged dead-end street at the edge of East Los Angeles in the shadow of an elevated freeway, cost $445,000 (U.S.) when she and her husband bought it in February, 2007.

Mrs. Ramirez, an office manager at a tortilla maker, and Mr. Ramirez, a truck driver, together make $48,000 a year. When a relative of theirs bought a house a few years ago, his real estate agent told the Ramirezes they could afford a house too. They had dreamed of owning a home for years, and jumped at the chance, scraping together a $5,000 down payment, or 1 per cent.

They moved into the one-storey, three-bedroom beige house in a working-class neighbourhood that was bid up in value during the boom, because while it's on the edges of the rougher parts of town, it's not too far from downtown or the ocean. A pleasant green cemetery is half a block away and the nearby main streets are colourful, lined by eclectic shops and strolling families, most of whom are Hispanic.

Today, the Ramirez home, with its rusted basketball hoop in the driveway and yellowed lawn, is worth just $360,000 – a drop of 20 per cent in less than a year and a half.

Yet their monthly mortgage payments have moved rapidly in the opposite direction, escalating to $4,500 from the $2,500 payment they originally made – a sum they believed was fixed for five years.
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Post by parvus »

Oh, I'm not taking sides, merely noting differing opinions. Were I a trader, like Rogers, I would have started shorting about a year ago based simply on the fact that the U.S. consumer has been greatly overextended for at least a decade. (But I'm kind of a perma-bear on the U.S. consumer and housing — or mebbe I've been reading too many of patriot1's posts. Then again, I was in the cheap seats when O&Y, ConfedLife, Baring's et al. foundered. :wink: )
Fannie Mae and Freddie Mac have raised a combined $20 billion since December to cover losses of more than $11 billion generated since the credit crisis began last year. Freddie Mac has yet to raise a planned $5.5 billion, scheduled for mid-year.

The companies have access to the Fed's so-called Fedwire payments system allowing them to access funding if needed, said Vincent Reinhart, the Fed's chief monetary-policy strategist from 2001 until September 2007.

They can withstand the slump in part because most of their investments are mortgages made before 2006 when lending standards were tighter, making them less likely to default, said Eileen Fahey, a Chicago-based analyst at Fitch Ratings.

``We do not believe they are technically insolvent,'' Fahey said. ``People seem to lose sight of the fact that a majority of the mortgages that they are holding and are guaranteeing were originated pre-2006.''

Default Swaps

Comments by the companies' regulator this week that they are adequately capitalized also eased concern, said Lawrence Yun, chief economist of the National Association of Realtors in Washington. The companies have about $80 billion of regulatory capital supporting $5.2 trillion of mortgages.
Poole's remarks, along with Bernanke's are in the full article.
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Post by Taggart »

parvus wrote: Then again, I was in the cheap seats when O&Y, ConfedLife, Baring's et al. foundered. :wink: )
I would add the "old" Royal Trust to that list. That's why I don't back up the truck when I'm buying any stock.
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Post by WishingWealth »

Another series in the NYT.
http://www.nytimes.com/2008/07/20/busin ... ref=slogin#

I particularly liked the title:
Given a Shovel, Americans Dig Deeper Into Debt

Not really a must read, there has been piles and piles of the same recently.
And I don't think that in the end much will change.
blonde has it right with his: '90%ers are like an open cash register for the exclusive use of the rightful owners of the world wealth'.

WW

I see that another red already linked to that.
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Post by mw »

Something of interest from The Economist, published July 17, perhaps has been linked here elsewhere:

Fannie Mae and Freddie Mac
End of illusions
After a headlong plunge in the two firms’ share prices (see chart 1), Hank Paulson, the treasury secretary, felt obliged to make an emergency announcement on July 13th. He will seek Congress’s approval for extending the Treasury’s credit lines to the pair and even buying their shares if necessary. Separately, the Federal Reserve said Fannie and Freddie could get financing at its discount window, a privilege previously available only to banks.

The absurdity of this situation was highlighted by the way the discount window works. The Fed does not just accept any old assets as collateral; it wants assets that are “safe”. As well as Treasury bonds, it is willing to accept paper issued by “government-sponsored enterprises” (GSEs). But the two most prominent GSEs are Fannie Mae and Freddie Mac. In theory, therefore, the two companies could issue their own debt and exchange it for loans from the government—the equivalent of having access to the printing press.
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Post by mw »

Housing prices haven't hit bottom yet
"I don't think we get strengthening in the housing market until late 2011 or 2012," said Mark Vitner, senior economist for Wachovia, the nation's fourth largest bank and one that this month hired the number-two man from the Treasury Department as its new chief executive officer to shore up its own growing exposure to mortgage debt.

Before bottoming out, prices nationwide should fall 22 percent to 29 percent on average from their peak, according to a report that Wachovia released last Monday.

"I think we're somewhere between halfway and two-thirds of the way through the correction," said Vitner, who closely studies the trends in home prices and home sales nationwide.
Snip.
"Prime loans are not the problem. They've actually held pretty stable considering how turbulent the market around them has been," said Rick Sharga, vice president of RealtyTrac, a large online foreclosure-listing service in Irvine, Calif., that publishes some of the most-cited nationwide foreclosure statistics.

Sharga thinks that even if prices continue to decline it's unlikely that prime loans will go the way of so-called sub-prime loans, which are defaulting at record rates.

"I don't think you are looking at a savings and loan (crisis scenario), where otherwise good-standing homeowners are losing their houses because they are worth considerably less than the mortgages," he said. "I don't see the market going that far down."
Yet there does seem to be an expansion of the problem at the notionally more stable end of the market.

Also not helpful to bank profits:

Commercial bankruptcies soar, reflecting widening economic woes
Commercial filings for the first half of 2008 are up 45 percent from last year, as the national climate for commerce continues to deteriorate amid rising energy and food costs, mounting job losses, tighter credit and a reticence among consumers to part with discretionary income.

From April through June, 15,471 U.S. businesses called it quits, according to data from Automated Access to Court Electronic Records, an Oklahoma City bankruptcy management and data company.

It was the 10th straight quarter that business bankruptcy filings have increased. Nearly 29,000 companies filed in the first half of 2008. Another 60,000 to 90,000 others probably have closed, because roughly two to three businesses fold for every one that files for bankruptcy, said Jack Williams, resident scholar at the American Bankruptcy Institute.
10 quarters... now *that* is a strong trend.
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Post by parvus »

WishingWealth wrote:I see that another red already linked to that.
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