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  #21  
Old 29.09.2008, 23:11
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Re: "The fundamentals"...

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Or will the revised bill save hides?
Gah! You do know who authored the bill, right? Buy the batteries!
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  #22  
Old 30.09.2008, 08:46
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Re: "The fundamentals"...

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come on Nev

do I have to put on 'sarcasm' lights or what ?
Sorry Dino.....yesterday was a tough day!
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  #23  
Old 30.09.2008, 14:28
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Re: "The fundamentals"...

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Gah! You do know who authored the bill, right? Buy the batteries!
On that note, here's what The Joker thinks...
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  #24  
Old 30.09.2008, 17:08
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Re: "The fundamentals"...

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Funny enough no one on the street is willing to buy these assets - might be something about the potential to actually resell them at a higher price.

Brace for impact.
But isn't the reason for that that all financial institutions (from the banks to the hedge funds to the fund of funds to the institutional investors) are struggling to find the liquidity to meet the deleveraging demands from further up the chain? That doesn't necessarily mean that the government couldn't break even/make a profit if it has the liquidity to buy at very depressed prices and wait for a long time until the markets have recovered (by which I mean stabilised). Not every single loan is going to default, there is some value there, so if they can buy them cheap enough and hold long-term then it is possible.

I'd be interested to hear your thoughts.
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Old 30.09.2008, 17:22
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Re: "The fundamentals"...

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But isn't the reason for that that all financial institutions (from the banks to the hedge funds to the fund of funds to the institutional investors) are struggling to find the liquidity to meet the deleveraging demands from further up the chain? That doesn't necessarily mean that the government couldn't break even/make a profit if it has the liquidity to buy at very depressed prices and wait for a long time until the markets have recovered (by which I mean stabilised).

I'd be interested to hear your thoughts.
Deleveraging is a symptom not the reason. You deleverage because you find out your risky assets are far riskier than you thought.

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Not every single loan is going to default, there is some value there
That's what Lehman types told me when trying to sell me a triple-A mortgage note program
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  #26  
Old 30.09.2008, 17:56
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Re: "The fundamentals"...

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Deleveraging is a symptom not the reason. You deleverage because you find out your risky assets are far riskier than you thought.
But although the original assets are riskier than you thought, the deleveraging process seems to be acting more like a snowball. Originally the assets were riskier and needed to be marked down significantly, but the ensuing snowball effect in the hedge fund industry etc might have reduced the current market values below what they could be worth in the long-term, simply because people are being forced to sell at more or less any price to return cash to their investors now. Once that process has ended, is there not a possibility that the valuations of these (still risky) assets might come back up a bit from today's prices?

Not every loan is worth zero... There is some inherent value there. It's just a matter of what price the Fed pays now, and what the long-term value might return to.

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That's what Lehman types told me when trying to sell me a triple-A mortgage note program
I think everyone knows by now how flaky that was
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