Thursday, August 23, 2007

Is It Over?

I mean the Rich Man's Panic of 2007?

No.

But the end game is unfolding rapidly before us now.

BAC invests $2 Billion in CFC in a convertible preferred stock. Hmmm, shades of Warren Buffet - he did a similar thing in 1987 for Saloman Brothers. That's his signature security. And Buffet owns a big chunk of BAC. Hmmmm. Interesting.

Wilbur Ross looking for subprime investments. Hmmm.

This track is following the script of the commercial real estate bust of the early 1990s, but about 10 times faster. That's not surprising, since then people were having to figure out the solutions. Now, they all have first hand experience on how a real estate credit bubble gets busted and mopped up. So they can move ultra-fast.

The beefers & investors holding the subprime debt are getting a bigtime haircut. Investors buying subprime paper at huge discounts can restructure the homeowners' debt and still make money - since they are buying the debt at huge markdowns. Political pressure against foreclosures and their huge costs will motivate this scenario, too. At the mortgage loan level, I think the combination of a big lender haircut & re-writing the homeowners' debt (as described a few days ago here) will do the job.

NYSE short interest dropped 3% - not really much. Some bears covered. The WSJ doesn't publish the full table now - cheapskates! Trying to save paper? Grrr. Maybe Barron's will publish the full table this weekend.

I'm still following the time diversification process. Be patient. Get good entries. The bears will keep hitting the market, so wait for dips.

73 comments:

Bud said...

Bman that's why i don't pay attention to short interest figures. All the guys i know have dramatically reduced their short positions. In some cases from 'locked and loaded' to almost nuthin. They made huge bets a month ago and have made a killing. I never found those short figures agree with what i saw.

PS...I have contacts with small beefers that have contacts with larger beefers etc.... I try to keep in touch and find out what guys much smarter than me are always thinkin. Kind of like i do here with you Bman.

Bud said...

Lmaooo....rich man's panic. Wait til bonus time. Cnbc and bloomberg both been talkin about how wall street bonuses gonna be down big time this year. That gonna cause some panic among the .....'rich man'.

Bud said...

Bman you think BAC /CFC affects Fed policy?

PS....I do not think the Fed shud cut rates right now. But I think they WILL cut 50bps before the september meeting. Too much crying.

Bud said...

stupid red sox lost.....yankees won....ugh.........5 game lead now


die yankees die !!!!!!

Bud said...

Saw a very very funny flic last nite. Superbad. Another judd apatow classic. Brought back memories of my teenage years. Put it on your list Bman.

Bud said...

I see the President is still delusional and clueless. He made a speech yday sayin 'a free Iraq is within reach'. Huh? He's tryin to run out the clock and then blame the next president. Meanwhile GI's getttin slaughtered everyday while the president makes speeches lyin to the american people.
W is a disgrace. He is so despicable. He sickens me.

Bunkerman said...

No, I don't think BAC-CFC affects the Fed. The writedowns & restructuring has to go on & it really needs a Fed rate cut to help move it along.

Bunkerman said...

I heard Lyndon's comment on the Vietnam analogy. Sheesh, he's realized that NOW!!! He & Rumsfled and Cheny made every one on LBJ's Vietnam mistakes and NOW he sees the similarities. What a complete dolt!

He's right about the cost of pulling out, though. Tough position HE PUT THE US INTO. If we had a decent Speaker of the House, I'd be calling for resignations.

Bud said...

Bman you still email the Fed? Have you done so in the past couple weeks? I know you used to in the past.

Bud said...

Here's a beefer that had a good week.


Aug. 23 (Bloomberg) -- Goldman Sachs Group Inc.'s Global Equity Opportunities hedge fund rose 12 percent last week after the securities firm shored up the money-losing pool with $3 billion of cash, investors said.

Bunkerman said...

No, I haven't sent them an email lately. I probably should have.

Bud said...

Nancy Pelosi is 1000x better than that obese disgusting pedophile denny hastert.

Bunkerman said...

I'm really surprised how shallow and ignorant so many equity players are about the debt markets and the Fed's responsibilities. They seem to think the world revolves around equity markets & equity market reactions, as if those are the only markets in the world.

I thought my generation of equity players was smarter than I'm seeing. The X'ers and Y'ers have an excuse. The boomers don't.

Bud said...

Bman you ever seen the documentary series The World at War. Complete account of ww2. Narrated by laurence olivier. I remember seeing it as a kid and it was on recently on cable. It's very very well done. I just ordered it from amazon.

Bunkerman said...

Pelosi is a spoiled rich broad of the Chardonay & Brie crowd.

Bunkerman said...

I have that complete set on VHS tapes, Bud - it's very good.

Bud said...

Exactly Bman. Either shallow and ignorant ....or just plain selfish and ...uh.....greedy. All they care about is what is good for their underwater portfolio's. Lookin for someone to bail them out of bad investing decisions.


PS....Can't believe i used the word 'greedy.' Bman brainwashing me? Ugh.

Bunkerman said...

"seeing it as a kid" Uhhhh are you trying to make me feel old?

Bunkerman said...

try "avaricious" Bud - a $10 word ;-)

Bud said...

Lol. I prolly saw it in the late 70s. I used to watch it with my Dad.

Bud said...

Bman angelo mozillo on cnbc today. I think it's a must watch........just for comedy purposes. He ain't gonna tell the truth about the mortgage business. He hasn't the last 12 months...why today?

Bud said...

Frosty i looked at the seagirls schedule. That looks like an under. I like the 49ers in the nfc-west. Official over/under picks will be posted late next week.

Bunkerman said...

yes, Bud, I'm looking forward to that overtanned slimeball today lolol

Spin-em said...

CFC dropping..still time for an Angelo no show

Bud said...

lmaooo spin

PS....CFC gonna 'fill the gap'?

Bunkerman said...

lol premarket geniuses finally figuring out the CFC dilution. dopes.

Bud said...

I'm considerin goin to Vegas this weekend and stayin there all next week. Beefers are not trading full throttle it seems. So i get bored. If the Fed cuts rates tomorrow am...i'm gone for sure. The only thing makin me work next week is I don't wanna miss the rate cut. We'll see.

Spin-em said...

page 13.......one fill the gap handbook on thw way Bud....lol

Spin-em said...

looking for that tight range day Frosty..re UNG..I mean what..they cancel winter?....lol

Frosty said...

the street figure out yet the fed from st louis was right? they just needed to get some cash where it needed to go...no need to lower rates...."mission accomplished"

Bud said...

Sheeesh. I need that 'fill the gap' handbook. So many stocks came right in off the open.

Frosty said...

BAC dropped a few pegs in my book...no big deal...will start a postion at 45, leaving room down to 40.

Bunkerman...still have some CSCO from last thursday....when do I get my real buyer merrit badge?

Bud said...

Mark Haines just said........panic of 1907.

lmaooooooooooooooo

Frosty said...

can't wait for euromern to return and give Bunkerman a little econ 101.....he is way bullish.

Bud said...

lmaooooooo....euromern. i think he's back....unless he decided to permanently move to amsterdam

Spin-em said...

the philly flasher..lmaooo

states going to hell....crackheads all the way to Erie.....for mern..lol

Bunkerman said...

Frosty, your virtual form is getting a bit more solid - maybe you are translucent now. ;-)

Bunkerman said...

Mozzilo doesn't have the fear that I sensed in February. He seems confident.

I don't think you'll get that 45 now Frosty.

Frosty said...

cramer, conrad rant wtf....the cardinal fed should have his head chopped off...his job is gut the non-banks and that's a fact jack... anyone ever hear of good cop bad cop...tick tack patty whack.

Bunkerman said...

This gives BAC more growth in the mortgage area. They'll probably form a JV with CFC to do them. With BAC's capital and branches and credit and CFCs offices, it would be very strong.

For BAC to buy them, they'd have to spin off the CFC bank & deposits. Could happen.

Spin-em said...

frost-izzle...lmao

mfl..mia..tip of my 40 to ya....lol

Frosty said...

Spin-em...AFSI going to fill gap one today...text book double gapper action....you should publish that handbook.

Spin-em said...

Rule 76....never..I mean never leave your wingman

Rule 54.....in sick markets....filldagap..lmao

Bud said...

Frosty i think spin busy right now with g-mac's autobiography. He calls the NBA ' a racist organization' in it.

PS. where is mfl? in europe too? or did market wash him out? or did he get sick of Bman's theories? i bet he away on an island

Frosty said...

seahawks under...you really do suck at sports betting.

Spin-em said...

whats the over under on the Giants Bud?..no Tiki...bet the D's stack the line and make Eli beat em....yeah right...6-10

Bunkerman said...

The Fed's caution in cutting is vexing me. I'm gonna have to pound them tomorrow AM and explain their errors.

maverick said...

Hold out for that BAC 45 frosty....
B'man testing trading gods patience

Bunkerman said...

not really mav. If I barge in & buy the rest of my position, that would do it. But I'm being patient and respectful of the gods by not doing that.

Bud said...

G'men are 8....and seagirls are 9....both look like unders

Frosty said...

vexing...there is no meat on my bone...LMAOOO

Spin-em said...

hope mfl is on an island....and not hunting....

Bud said...

Lol spin....i don't think mfl hunts. Killing animals for fun......that's what Frosty does . What a disgusting pig he is.

Frosty said...

westport wa vaca for labor day and some king salmon fishing chumboy...have a couple of open poles.

Spin-em said...

CTB...gets an upgrade...5 green bars at the fittee day

....I GOT MY EYE ON YOUUU

Frosty said...

gary cooper...huh....gary cooper is dead.

Spin-em said...

Gary full moon Cooper???...aoooooohhh..Al Bundy(whatever his name is)..John from Cincy

Bud said...

Lmaoo gary cooper. Sheesh frsoty.....do you only know movies form the 40s? It's from jonfromcinci.......what a weird show. I got my eyes on you!!!

lololololol

Frosty said...

CTB...duh

Bunkerman said...

Hey, High Noon is a great movie.

Spin-em said...

lmaooo

Spin-em said...

Cooper Tire

Frosty said...

TWM....moving into strong hands...no doubt I see real buyers.

Bud said...

Gary cooper was very good as lou gehrig in Pride of the yankees.

die yankees die!!!!


PS....i never seen Highnoon...but i seen it on 100 greatest movies of all time list. On my to do list.

Frosty said...

CMG darksider...good looking double gapper, ppfftt.

see god Bud...the end is near

Bud said...

lmaooooooo...the end is near

Bunkerman said...

uh ... TWM looks like a duoble top - inverse W formation - measuring to ... under 55 :-))

Bunkerman said...

sheesh, Bud ... you haven't seen Dr. Strangelove or Hign Noon. I hope you've seen Guys & Dolls.

Bud said...

Guys and dolls? Nope. 0-3. But i have seen Booty call.


lmaooooooooo

Frosty said...

Bud...going golfing friday....beefers could be gunning stops of the common man since there is no up tick rule to provide much needed protection...post the list in the morning either way.

Bud said...

Lmaoooo...protection for the common man.

No golf tomorrow. Will be working.

Frosty said...

Bunkerman...TWM inverse W...you aren't going to ease up until I get out the butta' are ya'.

Bunkerman said...

Gee Frosty, I'm just making the logical observations of the data, just like a computer would ;-)))