iBankCoin
18 years in Wall Street, left after finding out it was all horseshit. Founder/ Master and Commander: iBankCoin, finance news and commentary from the future.
Joined Nov 10, 2007
22,168 Blog Posts

iBankCoin: Your Home for the 2008 Market Meltdown/Global Fuckery

As we speak, the asshats are scrambling for safety nets. Scrambling, I say.

Go check who is the big dumbass holder of [[FNM]] debt. I insist.

Mr. MTG on Fannie:

[youtube:http://www.youtube.com/watch?v=WzUjccc9eHQ 450 300] If you enjoy the content at iBankCoin, please follow us on Twitter

136 comments

  1. boca

    PZN?

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  2. Aris

    china doesn’t give a fuck. they’re going to start packaging some of that paper in russian ipods.

    although i think it would be fitting if china sold off their notes to iran for pennies on the dollar.

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  3. confuse us

    CHL

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  4. DRUDGE

    BUSH CONSIDERS STEPPING UP PACE OF IRAQ PULLOUT… DEVELOPING…

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  5. calvino

    Yes, Pzena got fucked on that one. Much to your delight. So did Bill Miller and Alliance Bernstein. Care to venture a guess if the takeover of Indy Mac will be seen as good news for California banks?

    Let us keep the schadenfreude to a reasonable minimum, or in your case perhaps, go ahead and gloat.

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  6. Sir Douchebag

    Bill Miller: Great fucking example of the Black Swan and why everyone should read so-titled book.

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  7. Paradigm Shift

    The China holdings of FNM debt are actually counterfeit knock-offs that they bought from a guy with a pushcart on the street corner.

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  8. CAP

    Can someone here discuss the issue with Freddie Mac and Fannie Mae in clear terms so the rest of us can understand.I would like to get to the bottom of this. Right now everyone is running around like headless chickens. Lets see some real numbers and facts.

    Freddie and Fannie hold 6 trillion in US mortgages. Fannie has $42 billion in capital, Freddie has $38 billion. The question is how much capital do they really need to have and how much potential losses are they sitting on ? I believe the default rates for Freddie and Fannie are around 1.2% currently. Say even 2% of their entire portfolio of $6 trillion defaults and is unrecoverable. Thats $120 billion. So in this scenario how much would they needs to raise ? Keep in mind they are currently sitting on $80 billion as of the end of the 1st quarter.

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  9. Topper Harley

    Short of the Month: STT

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  10. Headless Chicken
    Headless Chicken

    1. 2% is conservative… this particular flavor of shit starts hitting the fan in ’09/’10

    2. credit markets are tight

    3. stock price is miniscule

    4. what form is that $80 billion in?

    If you’ll excuse me, I need to go “run around” and stuff.

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  11. Aris

    CAP, my $.02 analysis is this:

    normally, they could sell some bonds and issue some equity to keep things afloat without trouble, but LEH showed what the market is going to do to equity issues. maybe some sovereign fund would step in, but who knows at this point. the bond auction is monday, i think, so we’ll see how that goes.

    that 80B could disappear fast in a worst-case scenario, which would kill their ability to buy more paper, add huge risk to their debt holders, and also kill their business model. then banks would have to hold paper and jack up interest rates and place even more downward pressure on home prices and demand.

    so now nobody is going to want this stock, because the dividend could disappear overnight, there’s no growth, and there’s unlimited potential for dilution. doesn’t really matter what the govt does at this point. the only thing that could save the housing market right now is a planet full of aliens that had euros and wanted to buy up all the excess housing in the US and fill them with ipods.

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  12. Jimmy

    CAP, indepth commentary of FNM/FRE @ seekingalpha.com

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  13. SternBear

    CAP:

    This is from Alan Abelson’s column in Barrons this morning, discussing a report by Porter Stansberry issued about a month ago:

    Then, the roof fell in on housing and the curtain began to come down on the jolly times for Fannie and Freddie. Today, together they own or guarantee 45% of all U.S. mortgages, or a cool $4.8 trillion worth. Looking at their balance sheets, Porter points out, you find mortgages with a face value of $1.7 trillion, supported by assets of about $70 billion in core capital. On a combined basis, they’re leveraged 24-to-1, but when you toss in their off-balance sheet guarantees, that figure balloons to 68-to-1. It would only take a modest decline in the value of those mortgages to wipe out Fannie and Freddie’s equity.

    On that score, Porter finds it more than a little ominous that generally foreclosures and delinquencies are mounting relentlessly, the prices of houses have already fallen some 15% and an unprecedented 10% of homes built after 2000 stand vacant. And he ventures a sizable slice of the companies’ mortgage book — as much as 25% to 40% — may be under water, even without further disarray in housing and mortgages, which certainly seems in the cards.

    We’ve by no means exhausted the persuasive arguments backed up by compelling data he advances in support of his bearish forecast. But we thought it important to give you the flavor and gist of his report. Keep in mind he wrote the report over a month ago and nothing, as far we can see, has happened to contradict his dire prophecy.

    On Friday, deeply anxious about the run on Fannie and Freddie’s stocks and the grave implications for the financial markets here and everywhere, the Fed let it be known that it’ll prime the pump, if necessary, to keep the pair afloat.

    But Porter warned the same trick that calmed investors after the collapse of Bear Stearns and so far has managed to forefend a similar fate for kindred shaky firms just might not work this time around. He feels the securities — U.S. mortgages — against “which a large part of the world’s financial assets are leveraged have significantly and permanently declined in price. All the king’s horses and all the king’s men can’t put Humpty Dumpty back together again.”

    And, he believes, even if Congress decides to assume Fannie and Freddie’s liabilities “to prevent an unprecedented global calamity,” Congress won’t bail out the firms’ shareholders.

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  14. PleaseKillMe

    I wouldn’t mind being a FRE/FNM bond holder.

    The USSA won’t let them fail and will cover the bonds and MBS. If they don’t, where would these GSEs get the money to do business and who would buy their MBS without some steep premiums? Their default would mean that the Chinese are the biggest owners of US real estate property. They can choose which time-zone they want.

    Speaking of the Chinese, their stock market climbed 7% this week. What’s going on over there?

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  15. no, not odd at all
    no, not odd at all

    so, if we get some PPT wizardry monday morning or not; what’s going to zero first..FNM FRE or.. BKUNA DSL FED WM WB or mortgage insurers.. ABK MBI MTG ORI CNA FNF FAF ??

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  16. Hank Paulson

    Aris: contact me ASAP re: alien/ipod resolution scenario

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  17. Aris

    yes, sir, mr. paulson. i’ll be in touch.

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  18. James J. Cramer
    James J. Cramer

    They know NOTHING!

    Me neither.

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  19. CAP

    ‘On that score, Porter finds it more than a little ominous that generally foreclosures and delinquencies are mounting relentlessly, the prices of houses have already fallen some 15% and an unprecedented 10% of homes built after 2000 stand vacant. And he ventures a sizable slice of the companies’ mortgage book — as much as 25% to 40% — may be under water, even without further disarray in housing and mortgages, which certainly seems in the cards.’

    SternBear –

    10% of homes built after 2000 stand vacant.
    Can we get some hard evidence to support this ?

    And he ventures a sizable slice of the companies’ mortgage book — as much as 25% to 40% — may be under water,

    25%-40% underwater ? Where is he getting these numbers from ? Most of Freddie and Fannie loans were not even the 100% LTV variety. Prior to 2003 the majority of their loans were 80% LTV or less. Freddie and Fannie don’t have Pay Option ARMs on their books (not that I know). They didn’t buy exotic variety loans.

    Aris – to the best of my knowledge FNM, and FRE are having no problems selling loans (bonds). Its all US government backed. China and Japan are huge buyers.

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  20. Aris

    CAP, yeah, i haven’t read about any trouble selling the bonds, either. i think the auction on monday will at least be a gauge of sentiment, if nothing else.

    don’t forget, however, FRE/FNM bonds are only backed implicitly by the govt, and they could choose to not support them. i don’t think they’d turn their backs, because of the political element, but in this crazy world, you never know.

    i haven’t seen any of the data you’re looking for, though, so i’m not sure what’s really on their books. i think it would be fascinating to find out, though.

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  21. Hey Fly

    you still long UYG ? any stops ?

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  22. Black Monday

    See y’all real soon !

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  23. nullpointer

    that comment by hank paulsen was fucking “money”, bra

    smart and hilarious

    fly, you should seriously think about doing something like wallstrip – it would be an instant hit

    even if you aren’t all “television” ready, the writing is there, and thats the hard part…you could find people to deliver the lines aka lyndsey campbell

    you listening howard?

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  24. SternBear

    CAP:

    I don’t have access to the research report, so can’t answer your questions. On the quality of the loans underwritten, however, see Mr Mortgage’s latest post:

    There is also a misconception that Fannie and Freddie’s loans are all ‘prime’ and have little chance of default. Take it from this 20-yr mortgage veteran, nothing could be further from the truth. The agencies have hundreds of billions of the same Alt-A and subprime loans that are defaulting to such a great degree everywhere else. Fannie and Freddie’s approval systems, Desktop Underwriter (DU) and Loan Prospector (LP) respectively, used to be so flawed and relied so heavily on credit scores for an approval during the bubble years, that until recently that most full-doc loans with decent credit scores and LTV’s at 80% or below were allowed to pass without much income or asset documentation at all. They were closer to stated income loans than full doc. Yet, they are still considered ‘Prime’ in most cases. In addition, during the bubble years many non-cash out loans and purchases, were offered an ‘appraisal waiver’ if their systems like the profile of the borrower and property.
    –from July 11 post at
    http://mrmortgage.ml-implode.com/

    Whatever the percentage of loans underwater, there’s not much question in my mind that any kind of mark to market valuation would put the GSEs without equity. The leverage was way too big; the downward movement doesn’t have to be all that substantial to collapse the equity. The big question will be how to handle the debt, and the fact that such a big percentage is owned by the Chinese and Japanese central banks is really interesting, not to say ominous. Congress will want to save homeowners, but to screw the Chinese, and these fine sentiments will shape the ultimate legislation as the risks gets socialized.

    So this was the deal of the last ten years. Forgive me if I exaggerate. We moved our factories to China, and bought mammouth amounts of consumer goods on credit. In return for those goods we gave them pieces of paper based on the value of our homes. Their readiness to underwrite this fueled the bubble in housing. Now the collateral is underwater. The economists called this Bretton Woods II and thought it would go on forever; it is breaking down. Fact is, the Asian central banks were speculating in the US housing market with as much aplomb as The Tanned One.

    They will suffer for this!

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  25. Aris

    with all the earnings this week, i wonder if the market will stagnate a bit, until we hear from some ceos…

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  26. Deja Vous All Over Again
    Deja Vous All Over Again

    Melt up coming. Get long on the wash out. Have you forgotten?

    http://static.seekingalpha.com/uploads/2008/5/7/aapl2.png

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  27. Deja Vous All Over Again
    Deja Vous All Over Again

    “However, individuals with multiple accounts in the same name at the same bank are limited to the $100,000 cap, says Allan Roth, a Colorado Springs, Colo. financial planner. If an individual has a $100,000 savings account in her name and a $100,000 joint account with her husband, both accounts would be covered.

    “The difference is not in the number of accounts [that each individual has at an FDIC-insured bank],” said Roth. “The difference is in the titling [or name] on the account.”

    IndyMac customers with uninsured deposits will get at least half that money back, and they could get more back, depending on what the FDIC gets when it sells the bank, said Bair.”

    New to me! Wow!

    http://money.cnn.com/2008/07/12/news/companies/indymac_fdic/index.htm?postversion=2008071210

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  28. hahaha

    jack asses here and all over predicting ‘black monday’ at the same time, jack asses predicting a ‘wash out, melt up.’ ..lemme guess, non event, flat monday, drift for a while (slightly upward) until the bottom falls the fuck out. (when NONE of you jack asses are calling for it.)

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  29. JakeGint

    Go check who is the big dumbass holder of (FNM: 10.25 -22.35%) debt. I insist

    (Squeezes eyes shut, balls up fists heavenward)

    (Oh God, please let it be Warren Buffet!)

    (Please let it be Warren Buffet!)

    (Please let it be Warren Buffet!)

    (Pops eyes open, wide)

    IS IT WARREN BUFFET???!!

    _

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  30. JakeGint

    Hahaha —

    There you go fuggin it up by sayin’ it.

    What’d I tell you, bra?

    Sheesh…

    (eye roll)

    __

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  31. JakeGint

    I say make Mr. Mortgage your SpokesFly.

    Just give him the script, check with his sponsor to make sure he’s attending his meetings, and agree to pay for his forhead botox shots.

    Wicked killah combo.

    _

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  32. AI

    I dont see Warren on that list ………..

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  33. nullpointer

    jake-

    i dont think mr mortgage could pull off the condescending “tone” correctly

    krull is something closer, IMO

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  34. nullpointer

    am i banned from posting links?

    weird

    anyway, its all over the tubes:

    The (U.K) Times: Treasury rescue for Fannie and Freddie

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  35. Mad Max

    zzzzzzzzzzzzzzzzzzzzzzz……

    Who knew?

    Mr. Mortgage akin to some wall street analyst clown telling you to buy stock at the top.

    Wake me up when he’s got some real news.

    Thanks in advance.

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  36. Woodshedder

    “Wall Street could be exposed. David Trone, who follows financial stocks at Fox-Pitt, Kelton, estimated that Citigroup Inc. had $36 billion in mortgage securities backed by the companies and $15 billion in debt issued by them, and J.P. Morgan, $65 billion and $22 billion. Both companies declined to comment.”

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  37. Juice

    Douche .. everyone is looking for a bounce here, does that mean we plunge first, erasing those hopes & then bounce? That would be my current guess.

    But lower after that. SPX 1050 seems a reasonable target.

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  38. nullpointer

    my gut is saying the street will view $15B as grossly inadequate, while at the same time viewing it as an indication things are really fucked.

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  39. JakeGint

    Null,

    Krull is a natural comedian, and maybe has promise as a sidekick — a la “Ed McMahon.” But it’s obvious that meth-binging Mr. Mortgage has the “California Good looks” to bring in that totally necessary female consumer demographic*.

    Krull, otoh, has “a face made for radio.” Sorry, Krull.

    ____

    *(plus, it’s readily apparent he’s nucking futz.)

    _

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  40. Mr Mortgage

    If you would have shorted NLY and AGO a month ago when I told you to you would not have to be worrying about some BS countertrend rally. Both are zeros. Now, get into HRB before the shat splats the cat.

    By the way Max…how ya doing? I see you are in a particularly sour mood today. Went long a bit too early?

    People, including one of the best contrary indicators as of late I know Doug Kass, have been predicting countertrend and melt-up for a month now.

    yes, the market is bearish but excessively bearish I do not think so. There are too many yahoo’s still hopeful for a countertrend rally.

    When I quit hearing multiple times per day about the bottom, countertrend rallies, financials being oversold etc, I will cover SOME.

    Nobody to date is pricing in even close to the devistation the financials yet to have on the financial markets.

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  41. JakeGint

    Null, are you trying to do an embed, or just a link?

    __

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  42. BOOMER

    Mr. Mortgage has jumped the shark.

    Mortgage expert to whistle blower to market timer to trade advisor.

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  43. Mad Max

    Hi Mr. Mortgage,

    I would submit a question to you:

    What supreme purpose does your bullshit implode-o-blog serve to anybody with half a brain?

    Successful individuals focus 90% on solutions and 10% on problems.

    You are not one of those individuals. Your blather is rather worthless and egregious.

    Also, your idea of me is highly erroneous. I don’t need to argue with some clowntard on the internets about how well I’ve done over the past two years in the markets. I will guarantee you without a shadow of a doubt I’ve done much better than your bullshit 5 figure scottrade account.

    ps: you’re gay

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  44. Hybrid

    Mad Max

    You’re gay.

    And small time.

    Is your wife still texting her “emotional friend”?

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  45. JakeGint

    “Mad Max” is a gay moniker.

    And very eighties.

    Just sayin’.

    _

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  46. bloomberg

    SEC Says It Will Probe Efforts to Manipulate Stock Prices Through Rumors

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  47. BOOMER

    ThunderBone would be a good name for him.

    A nod to 80s Mad Max Thunder Dome, but also hints at a gay porn star. Perfect.

    Ok, ThunderBone it is.

    Aunty Entity: “Remember where you are – this is Thunderdome, and death is listening, and will take the first man that screams.”

    http://www.youtube.com/watch?v=1p2VjKueoBA

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  48. Stock Manipulator
    Stock Manipulator

    I hear LEH is well-capitalized and will report record blowout earnings, pass it on.

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  49. Richard Head

    This country just needs to come together. We might as well just put Mccain in as president and Obama as v.p. It would be modelled sort of like that 70’s sitcom “Chico and the Man”…Also Bernanke could raise money doing some Just for Men commercials for his beard,saying he’s “Stayin’ in the game” or something like that.

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  50. nullpointer

    hey thunder bone-

    i dont follow RE lending at all, so maybe it was obvious to everybody in that game, but i gotta tell ya, to my eyes mr mortage was dead nuts on like 6 months ago.

    he called it all, and backed it up with data.

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  51. Raptor

    This is the Raptor speaking:

    Gentlemen, we remain in a bear market. Had most of you realized this sooner rather than later (and my god the signs were obvious 12 months ago), your PnL might have been as fantastic as mine. Regardless, volatility is the major theme and so trading futures, options and FX couldn’t be more interesting. And that’s trading not investing. All you cheerleading ignorant “investors”, who fail to do anything but hit the “buy” button on a daily basis, are getting raped and rightfully so. Again, serious traders should thrive in this market. Most of you are not.

    Have a pleasant evening.

    PS: Danny Boy, please update the PnL on my rail shorts (CSX & NSC) – you did a great job earlier.

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  52. Govtbonds

    Sen. Schumer defends comments on IndyMac collapse By STEPHEN BERNARD, AP Business Writer
    9 minutes ago

    Sen. Charles Schumer on Sunday defended himself against claims by regulators that he was partially to blame for a run on IndyMac Bancorp Inc. that led to the bank’s takeover by the government Friday.

    At a news conference Sunday, the New York Democrat deflected blame cast upon him by regulators for causing a run on the bank that saw depositors withdraw more than $1.3 billion during the 11 days after Schumer released a letter about the possible risks of IndyMac failing.

    “The regulator here was asleep at the switch,” Schumer said. “The administration is doing what they always do, blaming the fire on the person who called 9-1-1.”

    Schumer noted his letter in late June provided “no new revelations” about IndyMac, and instead pointed out the bank’s problems had been building for years.

    On Friday, the Office of Thrift Supervision transferred control of IndyMac to the Federal Deposit Insurance Corp. because it did not think the lender could meet its depositors’ demands.

    IndyMac is the largest regulated thrift to fail and the second largest financial institution to close in U.S. history, regulators said after taking control of the bank.

    As of March 31, IndyMac had $19.06 billion in total deposits.

    Regulators pinned part of IndyMac’s recent problems on Schumer’s June 26 letter causing alarm with depositors, leading to the run on the bank that that essentially sapped it of the liquidity needed to continue functioning properly.

    During the housing boom earlier in the decade, IndyMac was one of the largest lenders of alt-A loans — mortgages given to customers with minor credit trouble or that did not have the proper documentation to receive a traditional, prime loan.

    Schumer was quick to point out Sunday that IndyMac is an outlier among banks because it was heavily involved in originating riskier mortgages than traditional community and regional banks.

    Defaults among alt-A mortgages, like many other nontraditional loans, rapidly increased over the past year, forcing banks like IndyMac to set aside more money to cover defaults.

    It also made it difficult for IndyMac to sell pools of mortgages — known as mortgage-backed securities — because investors shied away from bonds backed by the troubled loans. That left IndyMac searching for new ways to generate capital to continue operations, as it relied heavily on the mortgage securities market to raise funds.

    The bank is scheduled to reopen Monday as IndyMac Federal Bank, FSB, under the oversight of the FDIC.

    The FDIC estimates its takeover of IndyMac will cost between $4 billion and $8 billion.

    The FDIC set up a help page and hotline for IndyMac customers with questions regarding their deposits.

    _____

    AP Radio Correspondent Julie Walker in New York contributed to this report.

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  53. Woodshedder

    http://www.marketwatch.com/news/story/chinese-government-top-foreign-holder/story.aspx?guid=%7B347DF7BF-F0B7-48C9-A418-5A0B903D9F72%7D&dist=hppr

    WASHINGTON, Jul 11, 2008 (BUSINESS WIRE) — As politicians call for taxpayer bailouts and a government takeover of troubled mortgage lenders Freddie Mac and Fannie Mae, FreedomWorks would like to point out that a bailout is a transfer of possibly hundreds of billions of U.S. tax dollars to sophisticated investors and governments overseas.

    The top five foreign holders of Freddie and Fannie long-term debt are China, Japan, the Cayman Islands, Luxembourg, and Belgium. In total foreign investors hold over $1.3 trillion in these agency bonds, according to the U.S. Treasury’s most recent “Report on Foreign Portfolio Holdings of U.S. Securities.”

    FreedomWorks President Matt Kibbe commented, “The prospectus for every GSE bond clearly states that it is not backed by the United States government. That’s why investors holding agency bonds already receive a significant risk premium over Treasuries.”

    “A bailout at this stage would be the worst possible outcome for American taxpayers and mortgage holders, who have been paying a risk premium to these foreign investors. It would change the rules of the game retroactively and would directly subsidize the risks taken by sophisticated foreign investors.”

    “A bailout of GSE bondholders would be perhaps the greatest taxpayer rip-off in American history. It is bad economics and you can be sure it is terrible politics.”
    SOURCE: FreedomWorks

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  54. JakeGint

    A good man in a very tough job.

    Rest in peace, Tony Snow.

    _

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  55. JakeGint

    This country just needs to come together. We might as well just put Mccain in as president and Obama as v.p. It would be modelled sort of like that 70’s sitcom “Chico and the Man”…

    Wow, a Chico and the Man reference.

    I am in awe at your cultural perspicacity.

    Perfection. I wish I had a “double karma” button.

    _

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  56. JakeGint

    This is the Raptor speaking:

    Given the commentary software, ^^ this is redundant. ^^

    _

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  57. JakeGint

    Shed — GREAT article, thanks.

    ___

    Guv bonds — there’s probably no one here who thinks Chuck is more of a Schmuck than me. A schmuck and a corrupt Wall Street pocketed shill.

    That said, even I cannot lay IMB’s implosion on his wiley doorstep. It’s more like he was machining to get some of his WS cronies some aid with that letter, but it’s inadvertant release had nothing to do with whether IMB lived or died.

    The sub $2.00 stock price maybe had something to do with depositor’s panic, no?

    __

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  58. Juice

    http://www.youtube.com/watch?v=N6V5ym9kx_8

    The only man in the political arena who has a clue about financial markets, what to do, and what NOT to do about them

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  59. SatanicChihuahua
    SatanicChihuahua

    What will bring gas prices down? More drilling? More refining? Conservation? Shifts to alternative fuels?

    It turns out all you have to do is pray for gas to come down, and it will. Amen.

    http://www.liveleak.com/view?i=bce_1215886326

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  60. JakeGint

    Interesting article on our energy problems.

    Andy Grove on our Electric Future.

    _

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  61. nullpointer

    you know, body language speaks volumes

    watch lex luther when he talks

    his blink rate is off the fucking charts

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  62. Topper Harley

    Paulson pulls one from his bag’o’tricks – Treasury, Fed move to rescue Fannie and Freddie

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  63. SatanicChihuahua
    SatanicChihuahua

    Funny how on Friday OFHEO was saying Fannie and Freddie were adequately capitalized. Yet today, Paulson is asking Congress for authority to bail the fuckers out.

    Freddie is supposted to sell $3B of debt tomorrow. Paulson was reported to have been calling investors today to gauge their appetite for the new securities.

    I’m guessing he didn’t like what investors were saying.

    http://www.bloomberg.com/apps/news?pid=20601087&sid=aa7HR5UETT2E&refer=home

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  64. lol

    Funny, I’ve been praying for $150/barrel oil since last year. Isn’t there something in the Bible about “blessed are those who intelligently hedge thine commodity prices”? Maybe not.

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  65. nullpointer

    good find devil dog

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  66. Mad Max

    I actually came up with the lame handle from watching one of JakeGint or Woodshedder’s or Boomer’s video posts on Mad Max. Sorry for the unoriginality.

    Looks like the PPT is in full action on FNM & FRE.

    I’d like to see an intelligent argument on the virtues of letting those two companies fail without an armageddon type domino collapse in markets across the globe?

    I don’t think there is one, is there?

    ps:

    Mr. Mortgage I love you

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  67. BOOMER

    lol – I believe you are looking for Matt 10:16

    Behold, I send you out as sheep in the midst of wolves; so be shrewd as serpents and innocent as doves.

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  68. Mad Max

    Hey I’ve got a conspiracy theory about how Bushie announced of a possible drawdown of troops and assets from Iraq this fall relating to using the billions saved by that move for Fannie and Freddie…

    I will now go twist two limes in my beer…

    Cheers!

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  69. bloomberg

    futures up

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  70. Hybrid

    up up and away……..

    Will be adding to some longs in the morning. My guess is that we end up 300 plus.

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  71. nullpointer

    announcements of the discount window and the $15B during an interruption (breaking news!) of my wifes “”crime and murder” shows on ID channel

    my wife says “oh honey, is this what you were taking about?”

    this shit is serious, if my wife knows about it

    if we do rally, this is a fucking gift from heaven to go (more) short

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  72. TraderCaddy

    BSC,FNM,FRE saved. Next up WB,WM,AIG,LEH, and then last but not least United States of America. It will be a syndicate of Mideast Sovereign funds rescuing the latter. Let’s just WalMart them to death.
    Hey, I think I said a Calvino (without the colorful language)(still learning).

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  73. CubsRock

    http://apnews.myway.com/article/20080713/D91T7RHG0.html

    Stock Futures up, Oil/Corn down 😛

    U.S. considers increasing pace of Iraq pullout.

    Dare I go to sleep…

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  74. nullpointer

    whenever i read calvino, i get a mental picture of jim from taxi

    (thats a compliment cal)

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  75. TraderCaddy

    CubsRock will be dreaming of Ernie Banks and Ron Santo moving into their new homes built by RYL and TOL (as their stock prices too are saved by the Fed and get a boost tommorrow).

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  76. Hybrid

    Fuck you assholes.

    Im calling the shots around this bitch and making YOU pay for it. What are you gonna do about it, huh? Im out of this bullshit government in months from now anyway. Ive been busy drafting plans for my library too. There’s this company named Haliburton that said they could do it for me.

    Alright, thats enough. I need to go work on my memoirs. That advance should be here any day now.

    http://www.darrelplant.com/images/bush_middle_finger.jpg

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  77. Juice

    Boomer: I have a somewhat different version:

    “Behold, like sheep among the wolves, I am sending you among the ignorant and the idolaters.
    Therefore be wise as serpents and innocent as doves.”

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  78. DSB

    What’s the most reliable and accurate source for after hours and premarket quotes?

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  79. Mad Max

    LOL I got negative karmic points on the Iraq pullout thesis.

    You romanian goat cheesers know it true though 🙂

    I’ve decided to refrain from using curse words for a couple of days.

    I will buy some FUCK and short some YOU in the morning though.

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  80. Juice

    Golds next stop $1000.

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  81. Juice

    Mad Max, not a chance on that thesis. Bush couldn’t give 2 shits & a pretzel for what happens to FNM/FRE. If he pulls out of Iraq, its for redeployment against Iran.

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  82. Mad Max

    I disagree juice but interesting nonetheless.

    I would submit to you that there is a lot of negotiaton going on behind the scenes regarding Iraq with the Iranians. Yes, you read that right. As much as we are unaware to an extent what the PPT will do next to prop up mom and pop USA we are even more incredulous about what is going on behind the scenes in regards to the United States of America and its politicians/leaders negotiating with Iran.

    Read the latest STRATFOR Geopolitcal forecast and you just might glean something interesting and valuable.

    Or just write me off as an uniformed shmuck and call it a day.

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  83. calvino

    I’ll take the compliment. Reverend Ignotawski was written down to slapstick from the original scripts, and his name was ethnified. He was Harvard of high pedigree, and the lysergic acid did not do the kind of damage that he hammed. Alex got the highlight at the expense of the Reverend’s own wizened worldview. Nevertheless, a very well written show.

    naz futures up a steady one percent.

    MInute Maid.. wrong on the gold, at least tomorrow. Killer Hank will be selling gold, it would be bad form to let gold jump and the dollar shit itself on the next unconstitutional aggregation of powers by the bearded chairrat.

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  84. DSB

    Max, are you aware that John Mauldin said that the latest STRATFOR forecast was ‘optimistic’ in a letter from yesterday?

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  85. TraderCaddy

    My order of preference on the laugh meter: Rev. Jim, Louie DePalma, Latka, Tony, and Alex.

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  86. Juice

    I have no doubt there are behind the scenes contacts. I just don’t see BushInc as having any interest in a peaceful solution. I think the Iranian guy doesn’t want war but he loves to trash talk and is giving BushCo all the reasons they need to justify an attack.

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  87. Scabby

    I always thought the redhead was hot. Marilou Henner

    http://www.strangecelebrities.com/images/content/105499.jpg

    good god. old school.

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  88. Juice

    Cal-vino. Who knows about tomorrows move but money will flow into gold. There aren’t many gold stocks, watch them take off like the recent coal moves once Gold breaches $1K.

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  89. calvino

    This is very bad news for the dollar, I agree. There will be a time to move in to gold and the chf. I am not ready to say the sixty points move on the gold contract is a sign of bigger things, yet. I have the right to change my mind if the move extends beyond one percent. INcredibly, the buck is up on le euro, the hated yen and even the swiss franc. however if someone is determined to push the franc to 1.03 – I do not have the power to fight non-economic entities in the market. Although I did just sell some usd and bought chf, to get my toe in the door on the position.

    update.. naz and spx futs up one point two percent now.

    more update.. something has to give. oil down, gold up,

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  90. Henry Paulson

    Looks like I won this round Fuckers…Jog on

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  91. Scabby

    BUD confirms Inbev deal. About $70 a share take out, $50B

    Watch a new wave of M&A, foreign companies taking out the american greats. That’s what i think anyway.

    Shed – did you know Gibson was acquired by a german firm? TC Electronics

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  92. GOD

    ….

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  93. Woodshedder

    Scabby, I missed that news.

    That’s fucktarded, to say the least.

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  94. CEDC

    InBev + weak dollar + broad rally = CEDC+++

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  95. CNN

    flooding in tempe, az. what the hell is next?

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  96. next

    brazialian co buys a potash producer @ 100% premium

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  97. Mr Mortgage

    short into this.

    The story is the $3 bil short-term bond offering of freddie tomorrow was widely rumored to be a brick so they had to jump. The credit crisis has entered an entirely new phase where only Govt debt has value. The only reason agency paper caught a bid Fri was because they hoped a bailout would come. But, did you see what happened to UST? This is a fucking mess.

    Nevertheless, ALL spending bills must originated in the house and be passed by Congress. What Mr Clean is proposing is nothing right now. Lifting the debt ceiling! Haha.

    When they start talking about ‘explicit’ guaranties of $5.3 tril, watch the reaction. This This leaves the IB’s out in the lurch as well.

    Mudd and Dodd say this morning that the agencies are ‘well capitalized and doing fine’ and five hours later badly is talking about a ‘3 pronged approach’. This wont sit well. Futures mean shit.

    Remember, this is the 2nd inning for Fannie and Freddie. They haven’t seen nothin yet.

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  98. Mr Mortgage

    Freddie backed loans foreclosed to the tune of $15 bb alone last month. This is a ‘wait and see if it gets better’ move. I will be selling you shares if you are buying at 10am.

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  99. Mad Max

    Juice,

    Totally agree. In fact I’m leaning more toward your view.

    DSB,

    I like JM. He is a straight shooter. He leans towards optimstic view which I think is a healthy outlook. I’m a subscriber to the aforementioned (geo intel) report for what it is worth.

    I would rather read intelligent intelligence reports and do my own personal due diligence in what I am buying and selling then take some analyst advice with my hard earned euros…whooops, I mean dollars 🙂

    So far it works.

    Good luck.

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  100. Woodshedder

    Mr. Mortgage-

    I agree 100% with your analysis.

    However, there are a large number of market players with large profits from their shorts, and another large set of players with huge cash positions. This is a recipe for a rally. Fundamentals be damned…

    I have a feeling that the next bounce is going to be fucking explosive, and is not going to be something you will want to short into, until the momo wears off.

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  101. CAP

    ‘Freddie backed loans foreclosed to the tune of $15 bb alone last month. ‘

    Can we get the source for this $15 bb ?

    Fannie and Freddie are currently sitting on 20,000 REOs across the nation. By my calculation even assuming a worst case $200k loss per property, thats only $4 billion. Too be honest the loss per property will likely be less than $100k considering Fannie and Freddie had max loans of $417,000 until recently.

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  102. JakeGint

    Holy jumping shit, I cannot believe what I’m hearing.

    Shed, you think we’re going to have a relief rally, like an “oh yes, God, thank you, it’s finally over” rally?

    Are you shitting me?

    Have all of you lost your freaking minds?

    People — BSC was leveraged 33 to one when it went down. Fan and Fred are double that, conservatively.

    __

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  103. Mad Max

    Mr. Mtg,

    Cover your HRB short. You are going to get your ass handed to you. HRB is technically sound and has much
    less (if any at all) of the downside exposure you think.

    You were too late on the IMB call. I was shorting IMB last summer in the mid 20’s.

    You are dead wrong on the HRB call IMHO.

    I’ll be buying your borrowed shares into your pain.

    That is what makes a market.

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  104. JakeGint

    Over a hundo posts…rare these days. Where hast the Fly buzzered off to?

    __

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  105. Woodshedder

    Jake, we really have 2 choices here: Rally, or Crash.

    Being that I’m 95% in cash, I could really care less which way it moves.

    You call it a relief rally, I’ll call it a short squeeze. Either way, the market moves up. That’s what I expect, in the near term.

    Or we crash.

    As I said, I’m in cash, and not talking my book. I’m just looking at probabilities, and considering the fact that markets move both ways.

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  106. Rally Monkey

    Fuck all y’all.

    We rally to the point the shorts puke.

    My handlers at the PPT are bringing the market down in phases.

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  107. CAP

    Mr Mortgage,

    I forgot to add, FNM and FRE are only on the hook for 80% of the loans value. The remaning 20% is covered by mortgage insurance. Freddie and Fannie required mortgage insurance on all loans over 80% LTV. The risk is obviously if the properties sell for less than 80% of their loan balance in which case Freddie and Fannie lose money. But the losses will be lower than some of the more bearish folk are estimating. Freddie and Fannie did not give out home equity loans either. IMHO lenders of HELOCs are screwed i.e WAMU.

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  108. Juice

    The rally will last at most to Friday. SPX 1330 max & then a 25-30% haircut from there.

    This week will be the last chance out of dodge, imo.

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  109. JakeGint

    Weekend shot of the rally monkey.

    _

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  110. Gods of Option Expiration Magicks
    Gods of Option Expiration Magicks

    Greetings, all buyers and sellers of Stocks, Options, and other sundry Financial Instruments. Let me remind you that next week is the blessed Option Expiration week, and that as sweet Dawn shines her lovely face on us tomorrow morning, you may find it prudent to grab your Balls (no matter if you are long or short), for the volatility could turn the strongest of Men into the weakest of Babes as countertrend Moves beget counter-countertrend Moves. So it is written!

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  111. JakeGint

    Jake takes the rally monkey to biology class.

    Hilarity ensues!

    _

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  112. Woodshedder

    Jake, that’s pretty good.

    Fuck, even Bruce is calling for a crash. WTF?

    What is more probable, a 1970s style bear, or a 1987 style crash?

    If you go for the 70s bear, there are gonna be rallys.

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  113. Frank

    Who the fuck is Bruce?

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  114. JakeGint

    Juice/Bruce/Deuce/Moose/Goose

    Depends on the day.

    Shed, I think we are talking 1970’s, and I agree there will always be rallies… but this is too thin a skein of bullshit to fool anyone for more than 30 minutes tomorrow, if that much.

    __

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  115. DSB

    I think the last chance out of dodge may be short lived… or past us.

    Moved to PG

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  116. Swedish Chef

    Vie do vou vant to poken vun ov my verngrish?

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  117. allcash

    Market is looking for something to rally about the already rich but ballsless short-sellers. Short-term rally we will have. Well doesnt matter the Risk reward is not there. Just sit back relax and watch the drama unfolding

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  118. Aris

    the problem, i think, is everyone expects a crash or a rally. i’m inclined to believe that we’ll just get more of the slow bleed, followed by a few sector-based rallies here and there.

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  119. Mr Mortgage

    Max I was shorting pay option arm lenders including CFC, IMB, DSL, BKUNA, FED, AHM, BSC and LEH in March of 2007 when New Century went down. NEWC was subprime but I knew where it was going. Was far too early but it eventually paid big.

    At the same time I took down a basket of home builders. I was shorting public subprime mortgage co’s when the private company Own-It went down in Nov 2006. Got my first zero on NEWC. Then AHM was my first Pay Option lender to fall. Then ETFC on 2nd mortgage holders. Then all the MI companies. Went short the bond insurers in Aug 2007. Still have some original ABK from 89. I got TMA frm 26.25 to 50 cents. I just covered my last 5k IMB at $2.

    Dude, you have no idea. I was ahead of most everyone. All of my plays for the last year are well documented at http://www.tickerforum.org.

    Who the hell do you think you are talking to boy.

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  120. Mr Mortgage

    Cap – that is only 20k homes. No way. I have a great source at risk man. at Freddie. 15k last month. memo went out to upper mgmt to modify anything and everything but NO MORE FORECLOSURES.

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  121. Mad Max

    “Who the hell do you think you are talking to boy.”

    The mother of all internet fucktards.

    Any questions?

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  122. Mr Mortgage

    Most Fannie Freddie loans used 2nd mortgages over 80% because it was far less expensive than MI. On the 80%, values are down 30% on the median in the past 12 months alone, homes are bought back by the bank in 98% of the cases out of foreclosure at a 305 average discount and resold for a 50% average discount so the hits are substantial nevertheless. Whats 20% when you are losing 40-60 on every deal.

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  123. Mr Mortgage

    Above was supposed to say ‘on the 80% and above, values are down…

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  124. Jose

    Hey Esse,yu open up da borders and we’ll fix all your forclosures- no problemo

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  125. Mr Mortgage

    Hey Max go read a k or q for a change before you spew. HRB is a zero. I told you AGO, NLY and HRB weeks ago. Since, AGO is down frm 24 to 16, NLY is down from 18 to 12ish last week and HRB is still being held up by ignorant mutuals.

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  126. Your Skin is Thin
    Your Skin is Thin

    Hey Mortgage Man. Thicken up. Have a sandwich. We like you.

    But don’t start with the “I’m the man, I’m Nostradamus” shit. A little humility please.

    Eventually you will be very publicly wrong, and your blog will blow up. And then you’ll be just another “I was the shit in 2007/2008” guy.

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  127. Govtbonds

    Jake, I would say let chuckie stick to running government but the govt seems to be running this country into a fucking 3rd world mess. That might not be a bad idea, we would have oil at a cheaper price, who needs houses or medical care if we live in caves. just a thought.

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  128. JakeGint

    Guvvies,

    I live in an area chock full of caves, and have a nice line on some boxes of Rocket propelled grenades (buy 12, get a launcher free).

    Let me know if you’re interested.

    __

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  129. JakeGint

    130+ posts.

    Egregious.

    _

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  130. Mr Mortgage

    FT nails it…the market will see through this by 10am.

    http://www.ft.com/cms/s/0/d4794e4e-50fe-….

    From the article

    “What will force the issue is the ability of the GSEs to raise new capital and credit from private sources. They must do both to keep playing the pivotal role they have been assigned in sorting out the housing-finance mess. New private stakes in the enterprises are an unenticing prospect; and private lenders will be concerned about where they stand if more drastic remedies are tried. Until the situation is resolved, the upshot is likely to be a new reduction in the supply, and increase in the cost, of mortgage finance – further lessening the chances of an early recovery in the housing market and the wider economy. Look on your works, Fannie and Freddie, and despair.’

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  131. lol

    hyperinflation anyone?

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  132. Dinosaur Trader

    JakeGint Says:

    130+ posts.

    Egregious.

    43 of them yours…. egregious indeed.

    -DT

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  133. Mr Mortgage

    I have never blown my own nads here but when I am challenged in public I will. I don’t strike first blood.

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  134. Mr Mortgage

    Well that was fun. Its 10am!!! DING DING DING. I see alot of red in the financials. Lehman makes me smile.

    If they cant get a rally out of this confidence goes out the window and major problems (for bulls) happen.

    I got some good sells in today thats for sure.

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