Bubblevision had a number of bears on early. One bear was blabbing about CDOs and Bear Streans. He really didn't understand the risks of the securities in them. So why was he on TV? Because he is a bear and the doom-mongers are getting all the air time.
Structured securities have default risk and prepayment risk They are completely DIFFERENT but both can hurt a securities market value. I'm not going into the details, but those differences are why one can lose money in a AAA/Aaa security. And trying to sell those illiquid AAA/Aaa securities prematurely can magnify losses. Just letting them burn off will recover their value. Most people just don't understand the mathematics of mortgage backed securities or how the risks of the underlying instruments are divided into pieces. Some of those pieces are small and illiquid and should NEVER be funded with margin debt. It seems like the BS "geniuses" made that mistake. They knew better but got greedy.
This will pass. Focus on this week's Fed meeting. That is truly important.
PS: Many corn fields here look stunted. A few of the finer fields look OK. So I think lots of the corn planted on marginal acres will have poor yields. Holding my bushels for July weather.
PPS: I've been pounding the table on GOOG for weeks. I hope you are long. Full position here.
P^3S: The BSC short suggested late last week worked, too, if you tried it. Not in due to this trip.
The cost of everything is up right?... gas,milk,cheese, blah,blah,blah...The last 2 weeks around here, KO has been pushing buy 4 cases, get the fifth one free....Two bucks for a case???...Havent seen them making deals like that in a long time..End of quarter wheelin and dealin to make their #'s?
ReplyDeletethx for the corn report Bunk
like the CRNT chart....stop yesterdays low....takes out yesterdays highs...the sharks will find it....
ReplyDeleteI7ll drive out to the county later so will see more. Some corn I saw was only a foot tall. There was a wide range. None was as good as this time last year.
ReplyDeleteknee high by the 4th of July??
ReplyDeleteif the sharks find it spinny is that a good thing or a bad thing?
ReplyDeletelmaooo
ReplyDelete...well..I choose to wear a good guy white hat(Duke)
mfl...The Prince of Darkness(sneaky black hat)pfffttt
rofl...prince of darkness
ReplyDeleteKO and PEP have similar deals down here on soda (the name of my first child if i ever have 1). no discounts on beer though. in 1998 i decided either beer or soda had to go, in my diet. im comfortable with my decision.
ReplyDeleteive gotta smoke my breakfast
peace
Great North Special, were you on board?
You can't find a ride like that no more
Night the chariot swung down low
Ninety nine children had a chance to go
One long party from front to end
Tune to the whistle going round the bend
No big hurry, what do you say?
Might as well travel the elegant way
Might as well, might as well
Might as well, might as well
Might as well, might as well
Might as well, might as well
silver dirt napping.
ReplyDeletenp, yet
bunkerman forced beefer liquidations in gold and silver?
ReplyDeletefeels like it. the $ is down, too
the SLV chart looks horrendous
the bulls mite be "down the shore" till labor day
ReplyDeletebought the gap fill $NDX and some AAPL 120.85, bidding more 120.60..wed and thur could hold the mark up, should it come.
ReplyDeletejust read the bill gross july 07'investment outlook letter...yogi he is in spades, a piker he is not..."those that point to crisis averted are looking in the wrong places" papering over the hedge funds at bear is the start not the end as rates rise...yada yada yada....Bunkerman, weapons of mass destruction?
ReplyDeleteAAPL all filled up...now get out that friken' paint brush beefers...lol...I said beefers.
ReplyDeleterofl...paint brushes
ReplyDeleteBX trading under $31....wtf, don't these guys rule the present world? anyone stepping up to the plate?
ReplyDeleteThat AAPL chart looks like a rollover to me. No position here. Frosty I dbt a little BX under 31. Only make some lunch money if it works.
ReplyDeleteAPPL hard to argue right here, but that gap obligation from 8 trading days ago filled, that is what I have my eye on to hold or gonzo...BX here as well...lunch money, lol....frosty malted beverage ching or bust.
ReplyDeleteI'm out a lot while here so will not be able to quickly make comments.
ReplyDeleteIf you're short BSC, there is talk about that firm getting bought.
Kidder, Peabody got taken over when it got in trouble in the 1980s - on some mortgage paper, I think. Nothing definite and it might be nothing.
But remember the boxing rule, protect yourself at all times.
with today's super seeds, chest high by the 4th is the norm from emeory. Waist high at least.
ReplyDeleteI saw a lot of calf high corn.
This is just Ohio - not Iowa or ILL.
It seems like we get a commodity sell off at teh end of every month. Might be re-balancing.
ReplyDeleteGold and silver is likely beefer liquidations or end of month or some currency play. I was worried about stops at 650. The gold bears will start screeching soon.
I'm sure there is a lot of turmoil in the CDO market. (re Bill Gross). Corporate spreads were stupid and terms stupider. But without real defaults, I don't see this continuing for a long time. 1998 had a huge Russian default.
ReplyDeleteThe equity and junior tranches of some sub-prime RMBS will have losses, but that's why they got the yield.
It's always darkest before the dawn.
EMU one fine pick...have your yellow cake and eat it too? yeah bub i suck....nice fade bro. my stop is at 13.30 if you want to put frosty in the rinse cycle..lol.
ReplyDeleteBunkerman don't you realize armageddon is gonna come unannounced. There you are wandering thru the corn fields of Ohio without your....mre's, radiation pills, silver bars, firearms and other survival gear. That sure would be funny if civilization blew up while you on a road trip away from your bunker. Lmaooooooooooo
ReplyDeletebunkerman...my read on gross today is that the real losses, via defaults are coming as rates increase....smoke then fire. that people are brushing this off as managable, much like you are.
ReplyDeleteSo gross must think that if we do get defaults that one, the fed will stay put and/or the long end of the curve continues to rise...that's where I have a hard time after the LTCM bail out. so paint me in the bunker camp.
rofl Bud(pisser).........I bet his trunk is full of gear...perhaps he has a Bunker West at his mom's...I mean..the corn cob doesnt fall far from the stalk...lol
ReplyDeleteRoflmaoo...'bunker-west'
ReplyDeleteputting some SLV in the "retirement" account....i hope I dont turn into a werewolf....
ReplyDeleteSLV keeps goin down........Bunkerman better hurry back and dig up those silver bars and sell'em.....before they worth no more than candy bars.
ReplyDeleteI think the gold and silver are stored in this....heavily armed and ready to evacuate justin case..the Huns break the lines..
ReplyDeleteWOLVERINES!!!!
http://home.comcast.net/~hlparmy/images/m16pic8.jpg
LOl nice picture
ReplyDeleteIYZ, if they can't crack it with today's volume then I plan to buy the close and manage it around a 50 sma stop loss.
ReplyDeleteUh, a home mortgage default is not like a corporate default. The home mortgage is secured. The corporate bond is unsecured and behind the secured bank debt. So the actual loss is perhaps 25% on a home mortgage versus almost 100% on a corporate bond.
ReplyDeleteEven the default rates I've seen are nothing like a real recession does to the junk bond market.
So I thnk this is still domsayers.
PS: I remember Bill Gross writing such things in summer 2002 about the corporate bond market. That was the bottom then. Odd that his fund bought a corporate mortgage security from me at that time. That was a huge homer for his fund over time. So if he has facts, fine. Often that statemetn I made applies when the doomsayers are thickest: It's always darkest before the dawn.
Heck I remember hearing Citibank was going to fail around Christmas 1990 or so. (not sure of the exact year) That was a huge buy at $4.
I think we would even get a few days notice for an asteroid, Bud. It's a risk I take once in a while.
ReplyDeleteUh, don't you take that risk EVERY day heheheheh ;-)
I think the BS hedgie blow-ups are the fire, Frosty. I think the panic-mongers are hard at work to blow this up.
ReplyDeleteUh Bud - the old family home in Ohio had a real bomb shelter in the basement. I grew up playing Army in the basement. Attack that pillbox!!! :-)
ReplyDeleterumor that many of "the bulls" chartered the miss avalon and r headed blue fishing at 4pm and they wont be back until after the 4th
ReplyDeleteSheesh, I just heard Pisan wonder about 2PM selling for the past few day. Du'h ... margin calls on beefers.
ReplyDeleteif the FXY rallies, watch stocks die
ReplyDeletemargin calls....I thought beefers only stopped out on the darkside....LMAO
ReplyDeletelots of beefers own illiquid pieces of CDOs that are probably being chopped in value by the margin lenders. They've got problems and have to sell other stuff.
ReplyDeleteuhh bunkerman....don't you know that all beefers are great and they all make tons of money....they never incur margin calls....ROFL
ReplyDeleterofl the "god-like" beefers I keep hearing about. LMAO.
ReplyDeletebeef, its what for dinner!
ReplyDeletemern loading the ORCL truck at $19 for an earnings rip?
ReplyDeleteLOL frosty...'beefer margin calls darkside only'...................good to see u drinkin again...lmaooooooooooo
ReplyDeleteun bub....you know I only enjoy a malted beverage on days of the week that end in y.
ReplyDeletehey Bunkerman...dont forget to bring back enough pizza,sammys and brewski's from your buddy's for all us Bunkites...
ReplyDelete...and a wine cooler for Bud.....lol
no frosty was a busch gardens, riding roller coasters, on weed!
ReplyDeletei dont trade anymore, dont miss it either. down to 160 (10 more to go) pulse down to 73 vs 92ish and blood pressure down from 140 over 100 to 128 over 90. all in 2 months. except it took like 4 months to lose 20 lbs. the drinking makes it tuff, just have to run more
summer of mern mite end on friday when i have my big interview
skyline chilli for the bunker? that stuff harder to kill than coackroaches
ReplyDelete;-)
Mmmmm. Pizza @ beer. A fine meal. ;-)
ReplyDelete