March 9th, 2010
Full story here from ZeroHedge. My answer would be “Yes” except for the fact they they can print their own money and have totally bought out the political class. Macchiavelli would be proud.
With Geoffrey Batt
The ongoing troubles at the GSEs are no secret: it is public knowledge that Fannie had a 5.38% delinquency rate at December, while Freddie just passed the 4% threshold in January; both continue to rise rapidly each month. The fact that the mortgage-bond spread has just hit a record tight is merely an ongoing artifact of the Fed’s endless meddling in the mortgage market, with the sole purpose of keeping rates artificially low, and preventing banks from being forced to take massive writedowns on their entire loan book. This is all well known. What, however, seems to have escaped public attention is what the impact of these delinquencies is on the one largest holder of Mortgage Backed Securities, the Federal Reserve. Read the rest of this entry »
Tags: bankruptcy, derivatives, Fed, finance, mortgage disaster, scam
Posted in Uncategorized | No Comments »
March 8th, 2010
Full story here from ZeroHedge.
The horrible news hits just keep on coming for Goldman’s Jim O’Neill. First the BRIC acronym creator (soon to be largely forgotten when confronted with much more awesome comparables as CRAP and STUPID, the latter of which has already been subsumed for general consumption by CNBC) is rumored to be getting the boot from Goldman due to his involvement in the Red Knights group which is seeking to acquire the Red Devils (aka Manchester United), and now China just announced it is about to pull the rug out of the entire lending concept when it announces it is nullifying loan guarantees by all local governments. Just to put this in perspective, the impact of this is akin to what Obama did to Chrysler’s secured lenders, multiplied by about one Fed dollop of MBS holdings (i.e., trillion), with debtors not even getting the courtesy Steve Rattner K-Y reacharound. The total potential impact: $3.5 trillion smackers. And some large, recently bailed out bank, has been seen as claiming the CNY is about to get revalued. HA HA HA. Oh, and goodbye BRICs. Read the rest of this entry »
Tags: China, Goldman Sachs
Posted in Uncategorized | No Comments »
California’s coming war on banks and pre-crisis swaps
March 9th, 2010Full story here from Business Insider. Notice that the termination fees on these swaps are HUGE. This is not unlike the first Alien movie, and these municipalities are like John Hurt.
Is this man Wall Street’s #1 threat?
Meet LA Councilman Richard Alarcón.
He’s the one leading the city’s charge to repudiate a pre-crisis interest rate swap agreement that it made with Bank of New York Melon. Doing so would save the city $19 million per year, and with a budget gap of over $200 million, LA needs every dollar it can get its hands on.
The swap — one it made on a water bond pre-crisis — was supposed to protect the city against higher interest rates, though of course rate have collapsed, meaning the city remains on the hook for protection it doesn’t need. This is a hot topic, as numerous cities around the country are in a similar situation, a topic which Gretchen Morgenson covered yesterday. Read the rest of this entry »
Tags: Credit default swaps, debt slavery, interest rates
Posted in Commentary, Futures Market, Futures Market Commentary, Futures Trading | No Comments »